Kim Kardashian Sued For Promoting Crypto, To Pay More Than $1 Million Fine

Reality TV star and beauty mogul Kim Kardashian agreed to pay more than $1 million to settle U.S. Securities and Exchange Commission's charges. This was because she failed to disclose a payment she received for promoting EthereumMax’s crypto asset on Instagram. Also, she agreed not to promote crypto assets for three year

"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,” Gary Gensler, chairman of the SEC, according to CNBC. He also said that this case is a helpful reminder that the law requires celebrities and others to declare when and how much they were paid to endorse investing in securities.

In this case, the SEC said that Kim, who is reportedly worth $1.8 billion, acquired $250,000 for advertising cryptocurrency without disclosing it.

Her lawyer said Kim is happy to have resolved this matter with the SEC. She fully cooperated with the SEC from the very beginning and is ready to do whatever she can to assist the SEC in this matter. Kim wanted to get this matter behind her to avoid a protracted dispute. Kim's agreement with the SEC allows her to do that so that she can move on with her many different business pursuits, BBC reported.

Meanwhile, CNN reported that according to Charles Whitehead, a professor at Cornell Law School, the SEC may have targeted the reality TV star as a way to send a message to other influencers who might be promoting cryptocurrency or other investment assets. It is a way to warn them that if they are thinking about dealing with crypto, they have to think again. Also, the SEC is using Kim a model to boost compliance with securities laws, which is a smart way to bring attention to the matter so others will not do it.

Moreover, Kim isn’t the first celebrity to incur an SEC fine for using their fame to push cryptocurrency. In 2018 boxer Floyd Mayweather Jr. and music producer DJ Khaled both paid fines for promoting crypto Mayweather, who was paid $300,000, was hit with a bit more than $600,000 in penalties. Khaled, who was paid $50,000, was fined $150,000. Actor Steven Seagal was also fined more than $300,000 for doing the same thing in 2020.