The U.S. Securities and Exchange Commission (SEC) is charging Kim Kardashian for “unlawfully touting” a “crypto security,” the agency announced on Monday morning. The SEC says that Kardashian was in violation of its rules when she promoted a “crypto asset security offered and sold by EthereumMax” without the necessary disclosure that she was paid to promote it.
Kardashian has already agreed to settle the case, with a $1.26 million penalty payment, and to help the SEC with its ongoing investigation.
The agency specified that Kardashian should have disclosed a $250,000 payment she received to publish a post about EtherumMax’s EMAX tokens on her Instagram account. The settlement reached with the SEC by Kardashian includes a $260,000 payment that represents that original amount, plus interest, as well as $1 million in penalties.
SEC Chair Gary Gensler separately posted a message on Twitter about the settlement, noting that that celebrity endorsements should not be construed as financial advice basically. This could be a shot across the bow that indicates more enforcement activity is on the table for high-profile celebs who rode the crypto wave by touting specific assets to fans.