To settle civil charges brought against her for promoting a crypto asset, EthereumMax, on social media, Kim Kardashian, the reality TV star, has agreed to pay a fine of $1.26 million to the government.
The U.S. Securities and Exchange Commission charged the reality TV star with failure to disclose to her social media followers that she was being paid $250,000 to promote the Crypto asset on her Instagram. In addition to the fine, she has also agreed to cooperate in the ongoing investigation launched by SEC.
“This case is a reminder to celebrities and influencers who endorse investment opportunities that include crypto asset securities because it does not mean that those investment opportunities and products are right for everyone who invests,” SEC Chair Gary Gensler said. “We encourage people to consider potential risks involved in such investments and opportunities in light of their financial goals.”
Kardashian has also agreed not to promote any manner of crypto securities or assets for the next three years.
“Ms. Kardashian is pleased to resolve the matter with the SEC,” a statement from Kardashian’s attorneys read. “Ms. Kardashian fully cooperated from the very beginning with the SEC, and she remains committed to assisting the SEC in this matter in whatever way she can. She wanted to get this matter settled to avoid a protracted dispute. The agreement she reached allows her to do that so she can move forward and pursue her many different business pursuits.”
The SEC found that Kardashian had violated the anti-touting provision of the U.S. federal securities laws. Kardashian has thus agreed to the order, thereby passed without admitting or denying the SEC’s findings.
The settlement that she reached with SEC includes a $1 million fine and forfeit of the $250,000 amount she received for promoting the said Crypto asset, plus the interest.
To spread awareness and inform the public of heeding any such promotion by any manner of renowned personality, Gensler wrote the following on Twitter: “any celebrity or influencer’s incentives should not necessarily be aligned with yours.” He further said that those people who invest should not confuse the skills of celebrities who have “very different kinds of skills needed to offer such appropriate investment advice.”
On June 13, 2021, Kardashian took to Instagram and wrote, “Are you guys into crypto? This is not financial advice but sharing what my friends told me about the Ethereum max token!”
Kardashian also added many hashtags in this Instagram post that included #ad, #emax, #disrupthistory, etcetera.
The SEC revealed in its findings that Kardashian had nearly 225 million followers at the time of this post on Instagram .
Gensler had said in an interview with CNBC that the Hashtag ad was not enough to comply with the laws of the U.S. Securities and Exchange Commission in regard to touting investments.
“If you are advertising perfume, or if you are advertising a vacation home or anything else over the internet, there are numerous laws related to that,” Gensler said further.
According to Forbes, Kardashian has a net worth of an estimated $1.8 billion. Therefore, a $1.26 million fine would be equivalent to less than $100 for an average US family, which has a net worth of nearly $122,000, according to a recent estimate by the Federal Reserve.
Leave a comment
Your email address will not be published. Required fields are marked *
