The settlement with the SEC came after the three were charged in September for their participation in “unregistered and fraudulent” ICOs.
Three associates of Clifford Joseph Harris Jr., a rapper also known as T.I. who was responsible for helping launch the FLiK token, have agreed to pay more than $100,000 after a U.S. district court approving a settlement.
According to records filed Nov. 17 in the U.S. District Court for the Northern District of Georgia, Chance White, Owen Smith, and William Sparks Jr. will pay $102,992 in a settlement covering penalties, fees, and disgorgements for their role in selling tokens in initial coin offerings, or ICOs, for FLiK and CoinSpark. T.I., a rapper, singer, and songwriter, has won three Grammy Awards and had several hit singles including Whatever You Like and Live Your Life.
The SEC announced charges against the three in September along with Ryan Felton, founder of video production company AVA, and T.I., alleging that the ICOs were “unregistered and fraudulent.” Sparks, who is T.I.’s social media manager, was charged with violating registration provisions by allegedly selling FLiK tokens on the rapper’s social media accounts.
White and Smith, who are both involved in the Atlanta film industry, were charged with violating registration and anti-touting provisions for allegedly promoting CoinSpark without revealing they were being paid for their endorsement of the token.
The trio agreed to settlements at that time, which were approved by the court on Tuesday. The SEC’s case against Felton is reportedly still ongoing, while the commission ordered T.I. to pay a $75,000 penalty and not participate in offerings or sales of digital-asset securities for at least five years.
FLiK was one of many tokens announced during the 2017 ICO boom. When the token was launched that September, Felton claimed on social media that FLiK would see “tremendous growth in one year” and be redeemable for $14.99 in 15 months. However, the price of the token only reached $0.21 at its peak on Oct. 17 and is currently being traded at $0.000289 according to data from CoinMarketCap.
In 2018, a group of 25 investors named Felton and T.I. in a class-action lawsuit accusing them of running a pump-and-dump scheme with FLiK by hyping up the token using misleading information and celebrity endorsements.
The group’s legal team later amended the lawsuit to include comedian Kevin Hart for his alleged role. A U.S. district judge dismissed the suit against T.I. earlier this year, stating he found no concrete evidence of securities violations or negligent misrepresentation regarding the rapper touting FLiK.