New York ( Business) — Kim Kardashian agreed to pay a $1.26 million fine to the Securities and Exchange Commission (SEC) to settle civil charges after the reality TV star promoted a crypto asset, EthereumMax, on Instagram. .
The SEC accused Kardashian of failing to disclose that she had been paid $250,000 to post her message on Instagram. In addition to paying the fine, she agreed to cooperate with the SEC’s ongoing investigation.
“This case is a reminder that when celebrities or influencers endorse investment opportunities, including crypto-asset securities, it does not mean that those investment products are suitable for all investors,” said SEC Chairman Gary Genesler.
“We encourage investors to consider the potential risks and opportunities of an investment in light of their own financial objectives,” he added.
Kardashian also agreed not to promote any cryptocurrencies for three years.
“Ms. Kardashian is pleased to have resolved this matter with the SEC,” a statement from her attorneys said. “Kardashian has cooperated fully with the SEC from the beginning and remains willing to do whatever it can to assist the SEC in this matter. He wanted to put this matter behind him to avoid a protracted dispute. The agreement he reached with the SEC allows him to do that so you can get on with your various business activities.
The SEC found that Kardashian had violated the anti-advertising provision of the federal securities laws. Kardashian accepted the order without admitting or denying the SEC’s findings.
The settlement includes a $1 million fine and forfeiture of the $250,000 payment he received, plus interest.
Gensler tweeted that “the incentives of any celebrity or influencer are not necessarily aligned with yours.” He said that the investing public should not confuse the skills of celebrities “with the very different skills necessary to offer adequate investment advice”.
In the June 13, 2021 Instagram post, Kardashian wrote, “This is not financial advice, but sharing what my friends told me about ethereum max token!” She added different hashtags, including #ad, along with #emax and #disrupthistory, among others.
The #ad is not enough to comply with SEC laws when it comes to promoting investments, Gensler said in an interview on CNBC on Monday.
“If you’re advertising perfume, or you’re advertising vacation homes or anything else on the internet, there are various laws related to that. But these are securities laws,” he said.
