Kim Kardashian has reportedly agreed to pay $1.26 million in settlement to Securities and Exchange Commission as the celebrity was accused of touting a crypto asset security without disclosing the payment she received for the promotion.
As Variety reports, according to the SEC’s order, Kardashian failed to disclose that she was paid $250,000 to publish a post on her Instagram account about EMAX tokens, the crypto asset security being offered by EthereumMax. Kardashian’s post linked to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens.
“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 chairperson Gary Gensler said in a statement. “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.”
Per the report, under the settlement, without “admitting or denying the SEC’s findings,” the Kardashians star also agreed to not promote any crypto asset securities for three years, per the agency. An attorney for Kardashian said in a statement to the outlet, “Ms. Kardashian is pleased to have resolved this matter with the SEC.”
“Kardashian fully cooperated with the SEC from the very beginning, and she remains willing to do whatever she can to assist the SEC in this matter. She wanted to get this matter behind her to avoid a protracted dispute. The agreement she reached with the SEC allows her to do that so that she can move forward with her many different business pursuits.”
In a series of posts to her Instagram story in June 2021, Kardashian asked her followers, “Are you guys into crypto??? This is not financial advice but sharing what my friends just told me about the ethereum max token!” Her followers were then encouraged to head to the EthereumMax website and “join the E-Max community.” Her post included the hashtag “#AD,” suggesting that the stories were a paid promotion, but the SEC says this level of disclosure is inadequate for crypto investments leading the $1.26 million fine.
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