A group of 25 investors is taking legal action against T.I. after allegedly getting tricked into putting up $1.3 million for cryptocurrency backed by the rapper, according to TMZ. In August 2017, Tip and Atlanta-based businessman Ryan Felton announced the creation of FLiK Token with promises that seemed too good to be true. Felton claimed that one token would start at six cents each, but that investment would be worth $14.99 within 15 months, which represented a nearly 25,000 percent increase.
The suit alleges T.I. and Felton used a "pump and dump" scheme where they boosted the price of the tokens by using the money given to them by investors. It was evident in the value of the tokens initially jumping from six cents to 21 cents. However, that all changed when they dumped their tokens, and got out of dodge.
By August 2018, the tokens were worth less than a penny each. The investors were told by Felton that the price drop was because "T.I. had given FLiK tokens to members of his family and friends who had sold massive amounts on coinexchange.com causing rapid devaluation," perThe Blast. Felton is accused of creating a new company that he claims acquired FLiK Tokens, therefore, ridding himself of any blame for the cryptocurrency's further decline.
The suit claims T.I. and Felton created "the false impression that FLiK Tokens were a valuable liquid investment" by making it appear that Kevin Hart was going to be the face of FLiK.
Felton claimed that he got Dallas Mavericks owner Mark Cuban as an investor, and even "created fake online posts on behalf of Mark Cuban in order to manipulate the value of FLiK Tokens."
The investors are accusing of T.I. and Felton of securities fraud. They're seeking no less than $5 million in damages.
