Kim Kardashian has recently agreed to pay $1.26 million as a penalty to the Securities and Exchange Commission (SEC). She paid the penalty to settle the charges for allegedly touting a cryptocurrency token on social media without having disclosed how much she earned from the promotion. For the unversed, Kim Kardashian posted a story on Instagram on June 2021 and invited her 328 million followers to invest in what is called EthereumMax.
Here is what Kim Kardashian wrote on her Instagram story while promoting the cryptocurrency token, “This is not financial advice. But sharing what my friends just told me about the Ethereum Max token!” The beauty mogul also added the word ‘ad’ among her hashtags, implying the purpose was to promote it.
According to the latest reports, SEC has charged Kim Kardashian with unlawfully touting crypto security. The SEC further said that the beauty mogul was in violation of its rules when she chose to promote the crypto asset offered by EthereumMax without disclosing that she was paid to promote it.
Gary Gensler, Chairperson, US Securities and Exchange Commission, took to social media and revealed, “Today @SECGov, we charged Kim Kardashian for unlawfully touting a crypto security. This case is a reminder that, when celebrities / influencers endorse investment opps, including crypto asset securities, it doesn’t mean those investment products are right for all investors.”
Today @SECGov, we charged Kim Kardashian for unlawfully touting a crypto security.
This case is a reminder that, when celebrities / influencers endorse investment opps, including crypto asset securities, it doesn’t mean those investment products are right for all investors.
— Gary Gensler (@GaryGensler) October 3, 2022
He also said, “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.”
As mentioned earlier, Kim Kardashian has agreed to pay the charges and settle everything by cooperating with the commission’s ongoing investigation. The SEC order also states that Kim Kardashian failed to disclose that the cryptocurrency organization paid her $250,000 to publish the post on her Instagram account about EMAX tokens provided by EthereumMax.
Gurbir S. Grewal, the Director of the SEC’s Division of Enforcement, also said, “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 added, “Investors are entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information.”
View this post on Instagram
Talking about Kim Kardashian, she is currently seen in the second season of The Kardashians that is receiving a humongous response from the audience. She also attended the Paris Fashion Week with the rest of her siblings and children, where they met her ex-husband Kanye West too.