David Beckham is promoting a technology company embroiled in a dispute over claims its bosses swindled investors to finance lavish properties, luxury vacations and endorsement deals.
The former England captain announced his new role as ‘global brand ambassador’ for DigitalBits last month in a promotional video that saw him kick a football into the ‘metaverse’.
The digital currency firm already has deals worth more than £100m with Italian soccer clubs Inter Milan and Roma, as well as sports stars including former boxer Floyd Mayweather. Experts say Beckham’s deal could be worth £5m a year.
Own Goal: Former England Captain David Beckham in DigitalBits Ad
But the Mail on Sunday may reveal that DigitalBits bosses face accusations that they siphoned money from developing their technology to fund luxury travel and sports deals. A lawsuit filed in New York claims that a DigitalBits investor, Mark Dorrell, was “personally defrauded of at least $160 million.” [£122.5million] …by its founders, who took their cash and tokens and used them to unfairly enrich themselves and their friends.’
The lawsuit adds: “These acts have enabled the perpetrators to live extravagant and lavish lifestyles by traveling around the world, living and working between New York City and Palm Beach, Florida, Rome and Dubai, and purchasing vacation homes in the Cayman Islands”.
“Despite their extravagance, the funds they have improperly obtained have been enough to carry out massive promotional projects, such as one of their companies entering into a $36 million deal… as title sponsor of the Italian soccer team AS Roma” .
There is no suggestion that Beckham or any other celebrity ambassador is aware of any alleged wrongdoing.
Beckham’s finances have been in the spotlight since he sold a majority stake in his brand management company DB Ventures to Authentic Brands earlier this year, becoming an Authentic Brands shareholder in the process. But he has seen investments in UK-listed companies suffer a sell-off (see below).
Last weekend she attended her son Brooklyn’s lavish wedding to Nicola Peltz, daughter of billionaire activist investor Nelson Peltz.
DigitalBits creates technology that allows people to trade cryptocurrencies or digital works of art known as NFTs, or non-fungible tokens.
Star quality: David Beckham with his wife Victoria
The lawsuit alleges that the sponsorships were simply designed to increase the price of the DigitalBits cryptocurrency, while the technology does not exist as the company claims. The lawsuit was filed against DigitalBits founder Al Burgio, a serial entrepreneur who is now CEO of fintech firm Zytara. The lawsuit has also been filed against the DigitalBits Foundation, Zytara, the advisory firm GDA Capital and its co-founder Michael Gord.
The price of the cryptocurrency has plummeted considerably against the dollar over the past month. Adam Ford, attorney for Ford O’Brien, who represents the investors, said: “I am surprised that Mr. Beckham has announced his involvement in a project that still hides his alleged software from public view.” My clients believe that any compensation he has received is rightfully his and we are investigating how to recover it.”
Five other investors and former employees are understood to be about to sue DigitalBits for a total of $110 million. Full legal complaints are due this week.
Announcing his role at the company, Beckham said: “I have always prided myself on working with the best teams and I am very excited to work on my NFT collections and more innovations in the future.”
DigitalBits director Daniele Mensi said: “The DigitalBits Foundation has not done any business with the plaintiff making the accusations.”
He added: ‘The foundation plans to defend the lawsuit vigorously’ and said he was confident the claims would eventually be found to have no merit.
A spokesman for David Beckham declined to comment.
…and two of his stock bets crash
David Beckham may have become the first footballer to build a personal global brand, but he has scored an own goal in the stock market.
Two investments in London-listed companies suffered a painful sell-off despite occupying fast-growing markets.
Beckham was one of the founding investors in Guild Esports in 2019, which went on to float a year later.
The company has bounced from one problem to another, including the recent revelation that a multimillion-dollar endorsement deal with a European fintech company had failed to materialize. Its shares traded in October 2020 at 8.15 pence and have since fallen 78 per cent to 1.8 pence yesterday. Beckham has a 4.7 percent stake in the firm.
Cannabis oil company Cellular Goods has also been a flop, despite a promising start.
It traded at 5 pence in London in February last year and the share price soared to 19 pence on its debut, but has since plunged 85 per cent to 2.75 pence.
The company, in which Beckham has a 5 per cent stake, makes cannabidiol (CBD) capsules, drops and sprays for up to £49 a pack, but has had persistent problems being able to advertise online.
Last week it was also forced to admit that its CBD products may need to be pulled from store shelves, following discussions with the Food Standards Agency.
Stock market bets are unlikely to make a dent in the overall fortunes of Beckham and his wife Victoria, each worth an estimated £350m. His wealth comes from a variety of ventures and endorsement deals, from fashion to toiletries.
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