Kim Kardashian to Pay $1.26 Million in SEC Fines for ‘Unlawfully Touting Crypto Security’ on Instagram
Kardashian will pay over one million in penalties to settle the charges for the Instagram post that quietly earned her $250,000
Kim Kardashian attends The 2022 Met Gala Celebrating "In America: An Anthology of Fashion" at The Metropolitan Museum of Art on May 02, 2022 in New York City. DIMITRIOS KAMBOURIS/GETTY IMAGES
Kim Kardashian has agreed to settle charges brought against her by the Securities and Exchange Commission for unlawfully promoting a crypto security product on Instagram without disclosing that she had been paid $250,000 for the post. Now, the reality star will have to pay $1.26 million in penalties, disgorgement, and interest, in addition to cooperating with an ongoing investigation being conducted by the SEC.
“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 in a statement. “We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”
Shared last year, the post that earned Kardashian a quarter of a million dollars — but lost her much more — contained a link to the website for EthereumMax, which offers and sells a crypto asset security known as EMAX tokens.
Kardashian did not admit to or deny any of the SEC’s findings. However, she did agree to refrain from promoting any crypto asset securities for three years in addition to paying $260,000 in disgorgement for the payment she received, plus prejudgment interest and the $1 million penalty.
“Ms. Kardashian’s case also serves as a reminder to celebrities and others that the law requires them to disclose to the public when and how much they are paid to promote investing in securities,” Chair Gensler added.
“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,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement. “Investors are entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information.”
From Rolling Stone US.
