Kim Kardashian has agreed to pay a $1.26 million settlement with SEC for touting on social media a crypto asset security offered and sold by EthereumMax. The SKIMS mogul didn’t disclose the amount she received for the promotion.
The organization discovered that the star was paid $250,000 to publish the post on her Instagram about EMAX tokens. Kim K posted a link to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens.
Her case was used to admonish the public on the implications of doing such. According to the press release from SEC Chair Gary Gensler, stars posting about crypto assets doesn’t make it okay for everyone. He further encouraged investors to consider an investment’s potential risks and opportunities in light of their financial goals.
Kim Kardashian agreed to pay the SEC settlement without accepting or debunking their claim. The chair of the commission also reiterated that the law requires celebrities to disclose how much they were paid to the public for such posts.
Kim Kardashian’s SEC Settlement Comes With Other Terms
The director of the SEC’s Division of Enforcement weighed in on Kim Kardashian’s settlement case. As seen in the press release, he first stated that:
“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.”
Then he went on to reveal that investors of such crypto assets are entitled to know whether the publicity of the security is unbiased. Kim Kardashian failed to disclose this info, hence the $1.26 million SEC settlement. Breaking down the amount, $260,000 is in disgorgement, which represents her promotional payment, plus prejudgment interest. While $1,000,000 is the actual penalty.
However, that’s not all. She also agreed to not promote any crypto asset securities for three years. Kim Kardashian’s lawyer told E! News that she’s happy to clear the settlement with SEC. She corporated with the commission from the beginning and she’s willing to do whatever she can to assist the SEC on this issue.
