Software entrepreneur McAfee arrested on tax evasion charges

John McAfee, the controversial software entrepreneur, has been arrested in Spain on US charges that he evaded taxes on millions of dollars he earned from activities such as touting cryptocurrencies.

The US Department of Justice announced the criminal charges on Monday and said the extradition of Mr McAfee from Spain was pending. The Securities and Exchange Commission filed parallel civil charges.

Mr McAfee, who founded the antivirus software company that bears his name, hid millions of dollars of income from US tax authorities — including from promoting cryptocurrencies and selling the rights to his life story, according to the justice department.

He used bank and cryptocurrency accounts in the names of others to hide income earned between 2014 and 2018, prosecutors alleged. Assets he bought, including a yacht, were similarly held in the names of nominees to evade paying taxes, according to the criminal indictment.

Mr McAfee was a highly successful software innovator a decade ago when he sold McAfee to Intel for $7.6bn. But he went on the run after the 2012 murder of his neighbour in Belize.

He fled to neighbouring Guatemala and was later deported to the US. Mr McAfee was ultimately never charged in connection with the Belize case.

In 2019, Mr McAfee said he had fled the US on his yacht because he was facing criminal tax charges. In an interview with Agence France-Presse in Cuba in July that year, he said: “I have not paid taxes for eight years. I will not pay taxes again — it is unconstitutional and illegal.”

The justice department said on Monday that he had failed to file five years of tax returns between 2014 and 2018. The indictment against Mr McAfee had been filed in June but had remained under seal until his arrest.

The civil charges filed

John McAfee sued by SEC for ICO promotions, arrested on U.S. tax evasion charges

The U.S. Securities and Exchange Commission filed suit against crypto investor and promoter John McAfee for his past promotion of initial coin offerings (ICOs) on social media.

Per the complaint:

“From at least November 2017 through February 2018, McAfee leveraged his fame to make more than $23.1 million U.S. Dollars (“USD”) in undisclosed compensation by recommending at least seven “initial coin offerings” or ICOs to his Twitter followers. The ICOs at issue involved the offer and sale of digital asset securities and McAfee’s recommendations were materially false and misleading for several reasons.”

Specifically, McAfee was accused of not disclosing “that he was being paid to promote the ICOs by the issuers,” that he “falsely claimed to be an investor and/or a technical advisor when he recommended several ICOs,” that he “encouraged investors to purchase the securities sold in certain of the ICOs without disclosing that he was simultaneously trying to sell his own holdings and had paid another third-party promoter to tout the securities” and that he “engaged in a practice known as “scalping” as to at least one digital asset security, by accumulating large amounts of the digital asset security and touting it on Twitter without disclosing his intent to sell it.”

In a separate action announced by the Department of Justice, McAfee has been charged with tax evasion. McAfee has been arrested in Spain “where he is pending extradition.”

The DOJ stated:

“According to the indictment, John McAfee earned millions in income from promoting cryptocurrencies, consulting work, speaking engagements, and selling the rights to his life story for a documentary. From 2014 to 2018, McAfee allegedly failed to file tax returns, despite receiving considerable income from these sources. The indictment does not allege that during these years McAfee received any income or had any connection with the anti-virus

Members Of A Prominent Video Game Piracy Group Have Been Arrested

Members of the multinational video game piracy group Team Xecuter are facing multiple felony charges, the US Attorney’s Office of the Western District of Washington announced Friday. Max Louarn, Yuanning Chen, and Gary Bowser (yes, that’s really his last name) were all charged with 11 felony counts, including wire fraud, trafficking in circumvention devices, and conspiracy to commit money laundering.

“These defendants were allegedly leaders of a notorious international criminal group that reaped illegal profits for years by pirating video game technology of US companies,” Brian Rabbitt, Acting Assistant Attorney General of the Justice Department’s Criminal Division, said. “These arrests show that the department will hold accountable hackers who seek to commandeer and exploit the intellectual property of American companies for financial gain, no matter where they may be located.”

Team Xecuter, known for releasing homebrew software for various video game systems including the Nintendo Switch and 3DS, is comprised of more than a dozen members around the world. The indictment alleges the group “at times cloaked its illegal activity with a purported desire to support gaming enthusiasts who wanted to design their own video games for noncommercial use. However, the overwhelming demand and use for the enterprise’s devices was to play pirated video games.”

“These defendants lined their pockets by stealing and selling the intellectual property of other video-game developers–even going so far as to make customers pay a licensing fee to play stolen games,” US Attorney Brian Moran said. “This conduct doesn’t just harm billion-dollar companies, it hijacks the hard work of individuals working to advance in the video-game industry.”

The US Attorney’s Office notes these charges are still allegations at this point and the defendants have not yet been convicted. The case is being investigated jointly by the Federal Bureau of Investigation and Homeland Security Investigations. Louarn

Members Of Prominent Video Game Piracy Group Arrested

Members of the multinational video game piracy group Team Xecuter are facing multiple felony charges, the US Attorney’s Office of the Western District of Washington announced today. Max Louarn, Yuanning Chen, and Gary Bowser were all charged with 11 felony counts, including wire fraud, trafficking in circumvention devices, and conspiracy to commit money laundering.

“These defendants were allegedly leaders of a notorious international criminal group that reaped illegal profits for years by pirating video game technology of US companies,” Brian Rabbitt, Acting Assistant Attorney General of the Justice Department’s Criminal Division, said. “These arrests show that the department will hold accountable hackers who seek to commandeer and exploit the intellectual property of American companies for financial gain, no matter where they may be located.”

Team Xecuter, known for releasing homebrew software for various video game systems including the Nintendo Switch and 3DS, is comprised of more than a dozen members around the world. The indictment alleges the group “at times cloaked its illegal activity with a purported desire to support gaming enthusiasts who wanted to design their own video games for noncommercial use. However, the overwhelming demand and use for the enterprise’s devices was to play pirated video games.”

“These defendants lined their pockets by stealing and selling the intellectual property of other video-game developers–even going so far as to make customers pay a licensing fee to play stolen games,” US Attorney Brian Moran said. “This conduct doesn’t just harm billion-dollar companies, it hijacks the hard work of individuals working to advance in the video-game industry.”

The US Attorney’s Office notes these charges are still allegations at this point and the defendants have not yet been convicted. The case is being investigated jointly by the Federal Bureau of Investigation and Homeland Security Investigations. Louarn and Bowser were both arrested abroad

Bowser arrested and charged for selling Nintendo Switch hacks

Two members of a console hacking and piracy organization known as Team Xecuter have been arrested and charged with fraud, one of whom is named Gary Bowser. French national Max Louarn and Bowser, originally from Canada but arrested in the Dominican Republic, allegedly led the group, which makes a line of tools for cracking locked-down gaming hardware.

Team Xecuter is a sophisticated operation known best for its Nintendo hacks, including a USB device called the SX Pro that allows the Nintendo Switch to run pirated games. The group’s for-profit motive has made it controversial in the modding and emulation communities, reports Ars Technica, because those communities tend to focus on open-source efforts and shy away from selling products that could draw the attention of both console makers and federal authorities. Team Xecuter also makes hacking tools for the Nintendo 3DS and the NES Classic, among other devices.

Nintendo is well aware of the group, having filed two lawsuits against the organization back in May, with the primary intention of shutting down third-party retailers that resell Team Xecuter’s products online. Nintendo also has a controversial history of its own involving aggressive litigation over unauthorized use of its intellectual property. In more recent years, Nintendo has gone after so-called ROM sites that host ripped game files and other sites and web stores that traffic in pirated content and related hardware tools.

The Justice Department has gone further. “These defendants were allegedly leaders of a notorious international criminal group that reaped illegal profits for years by pirating video game technology of U.S. companies,” Brian C. Rabbitt, the acting assistant attorney general of the Justice Department’s Criminal Division, said in a statement. “These arrests show that the department will hold accountable