Kim Kardashian was one of many celebrities to endorse a cryptocurrency over the past few years but is just one of a few that are facing fines for doing so. On Monday, the Securities and Exchange Commission settled charges with Kardashian, fining her $1.26 million in the process.
The reality TV star shared a promotional post for her Instagram followers in 2021, touting crypto security called EthereumMax (EMAX). While there’s nothing wrong with that, Kim K made the mistake of not disclosing how much she was paid for the content – which was $250,000.
As a result, Kardashian is being fined $1 million, as well as forfeiting the $250,000 she made (plus interest) – bringing the total of the fine up to $1.26 million. To the average person, that’s more money than they’ve ever seen. To Kim Kardashian, it’s nothing more than pocket change.
SEC Chair, Gary Gensler, explained their decision to fine Kardashian, adding that the 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.”
“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,” added Gensler.
In addition to the fine, Kim Kardashian also agreed not to tout any crypto securities for the next three years – furthering the blow to all the influencers out there doing the same. It’s safe to say celebrities and influencers will think twice before promoting a cryptocurrency in the future.
Gurbir S. Grewal, Director of SEC’s Division of Enforcement, also chimed in – adding investors are “entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information.” As a result, her $250,000 payday turned into a $1.26 million fine.
Kim Kardashian Isn’t the First Celebrity to Receive This Fine
Kim Kardashian might be the latest celebrity to receive a fine from the SEC, but she isn’t the first and likely won’t be the last. For example, we saw similar situations happen to undefeated boxer Floyd Mayweather and producer DJ Khaled in 2018, as well as actor Steven Segal in 2020.
Mayweather was fined more than $600,000 after failing to disclose a $300,000 payment and DJ Khaled was fined more than $150,000 after failing to disclose a $50,000 payment – both celebs were touting Initial Coin Offerings (ICOs) and both celebs paid the price for not following the law.
As for Steven Segal, he was fined more than $300,000 after being promised $250,000 in cash and $750,000 in Bitcoiin2Gen (B2G) tokens. Of course, none of these fines come close to the one Kim Kardashian received – not that it really matters to the wealthy billionaire reality star.
With more than 331 million followers on Instagram, nearly 74 million followers on Twitter, 34 million followers on Facebook, and a net worth estimated at $1.8 billion, this fine isn’t going to budge Kim Kardashian one bit. She’ll be more careful in the crypto game, but not elsewhere.
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