SEC Fines Kim Kardashian For ‘Illegally Touting’ Crypto Security: Here’s How Much It Will Cost Her

Kim Kardashian was accused by the Securities and Exchange Commission of promoting a crypto asset security issued and sold by EthereumMax on social media without disclosing the compensation she received for the promotion.

Kardashian agreed to settle the case by paying $1.26 million in fines, reimbursement and interest, and cooperating with the Commission’s ongoing investigation.

According to the SEC, Kardashian did not disclose that she received $250,000 from EthereumMax for writing an article regarding EMAX tokens on her Instagram account.

Kardashian’s tweet included a link to the EthereumMax website, where potential investors could find instructions on how to buy EMAX coins.

“This case reminds us that when celebrities or influencers endorse investment opportunities, including crypto-asset securities, it does not mean that these investment products are suitable for all investors,” the chairman said. of the SEC. Gary Gensler.

“We encourage investors to consider the potential risks and opportunities of an investment in light of their own financial objectives.”

“Ms. Kardashian’s case also reminds celebrities and others that they are required by law to disclose to the public when and how much they are paid to promote investing in securities,” Gensler added.

Also Read: Cryptocurrency Popularity Among Millennials in the US Is Declining: Study

“Federal securities laws clearly state that any celebrity or other person who promotes a crypto asset security must disclose the nature, source, and amount of compensation they received in exchange for the promotion,” said Gurbir S. GrewalDirector of the Division of Enforcement of the SEC.

“Investors have a right to know whether a stock’s publicity is unbiased, and Ms. Kardashian has withheld that information.”

According to the SEC, Kardashian violated the anti-soliciting clause of federal securities laws.

Kardashian agreed to pay the $1.26 million, which included approximately $260,000 in restitution (reflecting her promotional money), plus prejudgment interest, as well as a $1,000,000 fine, without admitting nor dispute the SEC’s claims.

Kardashian also agreed to refrain for three years from endorsing any cryptocurrency-related securities.

In June last year, the celebrity posted an ad for EthereumMax on his Instagram story to his 228 million followers.

Followed by a short clip of her talking to her camera about EthereumMax with “#ad” written at the bottom of the screen, Kardashian posted the message: “Are you into crypto???”

Photo: Courtesy of Eva Rinaldi on flickr

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