Kim Kardashian charged by SEC over ‘pump and dump’ crypto scheme as the reality star agrees to pay $1.3M in fines
THE SEC has penalized Kim Kardashian for touting a crypto coin without disclosing that she was paid to promote it.
The Keeping Up With the Kardashians alum will pay $1.26million in fees to settle after breaking US rules in the exchange.
According to the SEC, Kim, 41, was reportedly paid $250,000 to post on her Instagram account about EMAX tokens, crypto created by EthereumMax.
She has yet to confirm or deny the allegations amid the ongoing case.
The SEC has required that celebrities and influencers make it clear if they are getting paid to promote specific cryptocurrencies to their fans.
In a statement made on Monday, SEC Chairman Gary Gensler explained: “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.
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“We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”
Boxer Floyd Mayweather and rapper DJ Khaled experienced a similar fate in 2018 when both were fined for not disclosing payouts they received for pushing specific crypto coin offerings.
Ever since the rise of digital currency, the Wall Street regulator has made it clear that the legal actions of virtual tokens are to be monitored.
The SEC applies a test to currency that has been promoted by an investor with the intention of profiting from the coin itself.
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LEGAL STRUGGLES
Kim has been embroiled in legal scandals recently, as just last month she and Scott Disick were sued for $40million for promoting luxury prizes that are allegedly part of a fake lottery scam.
The pair promised fans a chance at winning items like $130,000 cash, first-class tickets to LA, and a three-night stay in Beverly Hills.
Sources close to Curated Businesses, the company that organizes the lotteries, told TMZ that there have been legitimate winners.
They added that they have the paperwork to prove it.
However, the plaintiffs, people who entered the lotteries but did not win, claimed otherwise.
They alleged in their lawsuit that Kim, Scott and Curated Businesses organized the competitions on Instagram to allegedly sell their personal information to advertisers.
They claim they have been “invaded by hundreds of advertisers, some of which are soliciting the Plaintiffs with potentially offensive and unwanted content,” according to the lawsuit.
Scott is allegedly the main organizer of the contests and celebrities, like Kim, her sisters Khloe, Kourtney, Kylie Jenner, and their mom Kris Jenner, have helped promote them to their millions of fans on Instagram.
The Kardashians star Kim and KUWTK alum Scott are the only stars named in the suit, TMZ reported.
The plaintiffs are reportedly asking for $20 million each from Kim and Scott.
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The US Sun contacted representatives for Kim, Scott, and Curated Businesses but has not heard back yet.
Back in November, Kim, who lives in a $60million mansion and has a reported $1.4billion fortune, promoted a luxury giveaway with prizes of $100,000 cash and a three-night LA trip.
