According to the Securities and Exchange Commission (SEC), reality TV star Kim Kardashian could be the first of many celebrities to face fines over undisclosed payments from crypto firms. The SEC has issued an order to Kardashian, alleging that she promoted a cryptocurrency firm on Twitter without disclosing that she was paid for the endorsement. The SEC says that Kardashian’s tweets violated federal securities laws, and her failure to disclose the payments could have misled investors.
SEC crackdown on celebrity crypto endorsements
This is not the first time that the SEC has taken action against celebrities for promoting crypto firms without disclosing their financial interests. In November 2018, the agency fined boxer Floyd Mayweather and music producer DJ Khaled for failing to disclose their payments from ICO projects. The SEC’s actions against Kardashian and other celebrities suggest that the agency is taking a tough stance on undisclosed payments from crypto firms. Celebrities who endorse crypto projects should therefore make sure to disclose any financial interests they have in the project, in order to avoid running afoul of the SEC.
Kim Kardashian agreed to pay a $1.26 million fine
Kim Kardashian has agreed to pay a $1.26 million fine to settle civil charges with the Securities and Exchange Commission. The charges stem from a post she made on Instagram promoting a crypto asset called EthereumMax. According to the SEC, Kardashian failed to disclose that she was paid $250,000 for the post. In addition to paying the fine, she has agreed to cooperate with the SEC’s ongoing investigation.
SEC Warns Celebrities of Crypto Endorsements
The Securities and Exchange Commission has been issuing warnings about the dangers of celebrities promoting cryptocurrencies for some time. Previously, it warned that people should be aware that such endorsements could be unlawful if those celebrities do not disclose payments they have received. The SEC has taken action against a number of celebrities who have promoted cryptocurrencies without disclosing their financial interests. These cases demonstrate the importance of disclosures when celebrities endorse products, especially when those products are risky investments like cryptocurrencies.
Average US family would only pay $100 for the same fine
The Kardashian family is no stranger to controversy, and their vast wealth has often been a source of criticism. However, a recent fine levied against Kim Kardashian West highlights just how different the lives of the rich and famous are from those of ordinary Americans. According to Forbes, Kardashian’s net worth is estimated at $1.8 billion. So a $1.26 million fine is the equivalent of a fine of less than $100 for a typical US family, which has a net worth of about $122,000 according to the most recent estimate of the Federal Reserve.
For many Americans, such a sum would be difficult to scrape together even if they had months to pay it off. But for someone like Kardashian, who can easily afford to pay her fine in cash, it’s little more than an inconvenience. This stark contrast highlights the growing divide between the ultra-rich and everyone else in America.