NEW DELHI (CoinChapter.com) — The SEC slapped Kim Kardashian with a $1.26 million fine on the charges of failing to disclose a payment she received for promoting a crypto asset on her Instagram feed. Kim Kardashian was promoting an asset of the DeFi platform EthereumMax.
The SEC order pointed out that the reality TV star failed to disclose a payment of $250,000, which EthereumMax paid her to promote the platform’s native EMAX tokens. Furthermore, Kim Kardashian has also agreed to cooperate with ongoing investment.
Additionally, Kim Kardashian has agreed not to promote anything crypto for the next three years.
The SEC chairman Gary Gensler released a video warning investors of the dangers of taking investment advice from celebrity promotions.
When celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn’t mean that those investment products are right for all investors. We encourage investors to consider an investment’s potential risks and opportunities.
Gensler said.Gensler added that the skills of athletes, musicians, and celebrities, in general, may not translate well in the world of investments. Moreover, the SEC order highlighted that the case was a reminder to celebrities to disclose any payments they receive for promoting investment options like securities, etc.
Meanwhile, Kim has neither admitted to nor denied the regulatory body’s findings. Kim Kardashian’s lawyer stated that the celebrity fully cooperated with the SEC “from the very beginning.”
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Additionally, the lawyer stated that Kim “wanted to get this matter behind her to avoid a protracted dispute.”
What Did Kim Kardashian Do?
Kim Kardashian was already in troubled waters over the EthereumMax post. In Jan 2022, investors had filed a class action lawsuit against Floyd Mayweather and her for artificially inflating the price of EMAX tokens.
Though the SEC’s latest order noted that Kim Kardashian had used “#ad,” her post included a link to the EthereumMax website with instructions on how to buy the token. Kim, in her post, had written,
Are you guys into crypto????. This is not financial advice but sharing what my friends just told me about the Ethereum Max token
Afterward, other celebrities came up with similar paid promotions, including former NBA star Paul Pierce. The promotions attracted investors, who suffered massive losses as EthereumMax lost nearly all its value within months.
Investors who suffered losses alleged Kim Kardashian and other celebrities took payment for promoting a scam token.
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