Kim Kardashian has agreed to pay $1.26 million (€1.3 million) to settle charges with the US securities regulator for promoting a cryptocurrency without revealing that she was paid to do so.
The US Securities and Exchange Commission said on Monday the reality TV star did not disclose a $250,000 payment she received to post about crypto security tokens sold by EthereumMax on her Instagram account, which has 331 million followers.
Ms Kardashian last year asked her then 225 million followers: “Are you guys into crypto????” in an Instagram post that drew attention to EthereumMax, a new coin at the time. Her post contained a link to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens.
Gary Gensler, SEC chairman, said: “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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The SEC said that the reality TV star and entrepreneur has agreed to co-operate with its ongoing investigation.
“The federal securities laws are clear that any celebrity or other individual who promotes a crypto asset security must disclose the nature, source, and amount of compensation they received in exchange for the promotion,” Gurbir Grewal, director of the SEC’s division of enforcement, said in a prepared statement.
Ms Kardashian — who neither admitted nor denied the SEC’s findings — violated the anti-touting provisions in US securities laws, the agency said. She has agreed to not promote any crypto asset securities for three years.
A lawyer representing Ms Kardashian did not immediately respond to requests for comment. — Copyright The Financial Times Limited 2022/Reuters
