According to a news release released by the commission, Kim omitted saying that she received $250,000 in payment for the advertisement she shared on Instagram. According to the SEC, the posted offer included a link that took visitors to a home page where they could find information on how to purchase the token.
Kim has not recognized or denied that she breached the federal securities laws' anti-touting clause. She has, nonetheless, committed to pay a total of $1.26 million, which consisted of a $260,000 disgorgement (which will replace the compensation she received for the advertisements), pre-judgment fees, and a $1 million fine.
“This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesnt mean that those investment products are right for all investors,” SEC Chair Gary Gensler stated.
The regulator declared that superstars must report any compensation they get and that the general public has a right to know. As part of the celebrity's punishment, she also consented to refrain from endorsing any cryptocurrency products for the following three years. She also consented to work with the detectives because the case is still quite active.
Celebrities who advocate fake crypto tokens are notorious to face severe sentences from the SEC. Floyd Mayweather, a legendary professional boxer, was also charged in June 2020 for promoting Centra Tech's initial coin offering (ICO) in 2017.
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