Kim Kardashian was a trending topic on Twitter Monday morning (Oct. 3) after a report went wide that she entered into a settlement with the Securities and Exchange Commission over a cryptocurrency promotion. The social media influencer will pay $1.26 million to the SEC after failing to disclose that the cryptocurrency company she promoted paid her $250,000 in exchange.
According to a press release issued by the SEC on Monday, Kim Kardashian, 41, will pay $1.26 after promoting EMAX tokens from crypto firm EthereumMax. The company paid Kardashian to promote the token on her popular Instagram page and urged her followers to purchase the currency complete with instructions.
From the SEC:
“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,” said SEC Chair Gary Gensler. “We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”
“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,” Chair Gensler added.
“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,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement. “Investors are entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information.”
In addition to the settlement, Kardashian is not allowed to promote cryptocurrency for the next three years. The SEC’s ruling falls under its anti-touting provision of the federal securities laws and is still under an open investigation.
On Twitter, folks are reacting to Kim Kardashian and the SEC ruling. Those replies can be found below.