Kim Kardashian is witnessing a charge from the SEC to the tune of $1.2M for promoting Ether MAX tokens.
The United States Securities and Exchange Commission has remained persistent in its regulation by enforcement exercises. The American financial regulator has again diverted its attention to a prominent figure. American socialite Kim Kardashian is the latest to get caught in the watchdog’s net.
The SEC revealed its charge on the prominent businesswoman and Popular television personality through an official press release. Kardashian promoted EthereumMax tokens on Instagram via her official handle in June last year.
According to the press release, Kardashian’s act of promotion violated its securities laws in the area of anti-touting provisions, as she failed to disclose the amount she received as remuneration for the act. She is alleged to have received up to $250k for the promotional message.
Kardashian has already agreed to comply with the SEC’s demands without refuting the claims or conceding. These demands include cooperation with the agency as its investigation on the matter progresses and a fine of $1.26M. The fine involves the $260k received by Kardashian for the promotion and gains accrued and a $1M penalty for violating the securities law.
“This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto-asset securities, it doesn’t mean that those investment products are right for all investors,” SEC Chair Gary Gensler said, speaking on the matter.
Gensler further noted that personalities attempting to promote these tokens should consider the investment risks involved and duly notify the public of the nature of the promotion. Gensler pointed out that securities laws demand that influencers disclose if they were paid for a promotion and how much they received.
Furthermore, Gurbir Grewal, Director of the Division of Enforcement at the SEC, sought to buttress Gensler’s point on the matter. “The federal securities laws are clear that any celebrity or other individual who promotes a crypto asset security must disclose the nature, source, and amount of compensation they received in exchange for the promotion,” he noted.
Grewal highlighted that investors witnessing any call for investments ought to be in the know regarding a critical point – whether the publicity is biased or not. According to Grewal, Kardashian omitted this information despite indicating that the post was an ad.
Recall that back in 2021; The Crypto Basic noted that Kardashian took to her Instagram page to promote a shady crypto project dubbed EthereumMax last year. Kardashian’s promotion of the token reached hundreds of millions of followers at the time despite its shady nature of not having sufficient background information. Furthermore, it was discovered that 30% of crypto owners were exposed to Kardashian’s ad – that translates to 3 out of 10 crypto proponents in 2021.
Kardashian was not the first to receive these charges from the SEC. Last month, the SEC filed a lawsuit against prominent crypto influencer Ian Balina for promoting failed crypto token SPRK in 2018.
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Source: https://thecryptobasic.com/2022/10/03/kim-kardashian-hit-with-1-2m-fine-from-the-sec-for-promoting-shady-crypto/?utm_source=rss&utm_medium=rss&utm_campaign=kim-kardashian-hit-with-1-2m-fine-from-the-sec-for-promoting-shady-crypto