Sometimes that #ad isn't enough. After touting EthereumMax on Instagram, Kim Kardashian has come to an agreement with the Securities and Exchange Commission to pay $1.26 million to settle civil charges. The charges stem from her hiding that she was paid $250,000 for the post.
This all started in June of last year when Kardashian made an Instagram post with the caption, "Are you guys into crypto? This is not financial advice but sharing what my friends told me about the ethereum max token!" The post was shared to her 225 million followers and the price quickly shot up.
Turns out Kardashian got a hefty bag for it. $250,000 to be exact. Despite the sneaky #ad snuck into the caption, the post still violated the SEC's anti-touting provision, which regulates paid promotions of securities offerings. The Instagram icon agreed to pay the fine without confirming or denying the SEC's findings. The settlement includes a million-dollar fine as well as forfeiting the $250,000 plus interest.
SEC Chair Gary Gensler took to Twitter to celebrate this victory. "Today, we charged Kim Kardashian for unlawfully touting a crypto security," Gensler wrote. "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."
\u201cToday @SECGov, we charged Kim Kardashian for unlawfully touting a crypto security.\n\nThis case is a reminder that, when celebrities / influencers endorse investment opps, including crypto asset securities, it doesn\u2019t mean those investment products are right for all investors.\u201d— Gary Gensler (@Gary Gensler) 1664796644
This isn't the only case against Kardashian after her deceptive Instagram post. She was sued by investors in January for artificially inflating the price of EthereumMax alongside Floyd Mayweather. Part of the anti-touting regulations is to avoid significant losses, as celebrity sponsorships raise the market cap of these coins. Once the cap is raised, certain investors (and the creators of the coins) reap the benefits and run away, leaving everyone else with nothing.
According to Forbes, Kardashian will barely feel the fine. With a net worth of almost $1.8 billion, the $1.26 million is a drop in the bucket. Maybe her concrete home decor will more than make up for it.
Photo courtesy of Jason Sean Weiss/BFA
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