- Kim Kardashian agrees to pay a $1.26m fine to SEC
- The influencer failed to disclose a payment she received for touting a crypto asset on her Instagram feed
- The settlement between Kardashian and the U.S. regulator is a warning to all other influencers
Kim Kardashian’s efforts to pocket some easy money by plugging a crypto asset to her followers has landed her in hot water with one of the most hard-nosed regulators in the industry.
Kardashian Falls Foul of U.S. Securities and Exchange Commission
The reality TV superstar’s antics involved promoting EthereumMax’s crypto asset without telling her 334 million Insta followers that she was receiving a $250,000 fee for doing so. While the crypto market is itself unregulated, that breached the SEC’s guidelines to a sufficient extent that the authority could intervene.
“Kardashian agreed to settle the charges, pay $1.26 million in penalties, disgorgement, and interest, and cooperate with the Commission’s ongoing investigation.”
Kardashian is nursing a +$1m loss on her venture and is also having to devote time to demonstrate that she is following market rules. There is also the reputational damage to consider. While it’s game over for Kardashian, it could just be the start of the story for other influencers who are now under scrutiny by the SEC.
HEX, Pulsechain and PulseX in the Spotlight
The SEC has reportedly issued a subpoena to influencers who are alleged to have been promoting cryptocurrencies such as HEX, Pulsechain and PulseX. The names of the suspect influencers aren’t yet public but are known by the SEC, which has contacted them directly. The SEC’s letter to them states:
“We believe that you may possess documents and data that are relevant to an ongoing investigation being conducted by the staff of the United States Securities and Exchange Commission.”
The letter was accompanied by a subpoena issued as part of the investigation. In what is rapidly becoming a crypto ‘whodunnit’, those in question must have produced the required documents by November 15, 2022. There is no further statement from the SEC regarding when updates might be made public.
Amid the excitement, the significant development is that the move reflects a major shift by the SEC to intervene in such cases. It’s getting past the issue of coins being previously regarded as outside its remit. SEC Chair Gary Gensler stated that the commission’s enforcement staff are “public servants” and “cops on the beat” who were “uniting public zeal with unusual capacity.” (Source: Cryptosrus.com)
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