Kim Kardashian has agreed to pay $1.26 million to settle Securities and Exchange Commission charges that she failed to disclose a payment she received for advertising a crypto asset on Instagram, the agency said Monday.
"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, said in a news release.
Kardashian found herself in hot water after failing to disclose she had been paid $250,000 to post a promotion for EthereumMax's crypto asset, EMAX tokens, the agency said.
"ARE YOU INTO CRYPTO??? THIS IS NOT FINANCIAL ADVICE BUT SHARING WHAT MY FRIENDS JUST TOLD ME ABOUT THE ETHEREUM MAX TOKEN," she posted in June of last year, along with a link to the EthereumMax website.
Investors sued Kardashian, as well as former NBA star Paul Pierce and boxer Floyd Mayweather Jr., over their promotional posts for EthereumMax, accusing the three celebrities of artificially inflating the value of the asset.
Kardashian has agreed to cooperate with an ongoing investigation and to abstain from promoting crypto securities for three years. The $1.26 million settlement covers the payment she received for the post plus interest, as well as a $1 million penalty.
Kardashian, who is reportedly worth $1.8 billion, did not admit or deny wrongdoing.
"Kardashian fully cooperated with the SEC from the very beginning and she remains willing to do whatever she can to assist the SEC in this matter,” a lawyer for the reality star said in a statement. “She wanted to get this matter behind her to avoid a protracted dispute. The agreement she reached with the SEC allows her to do that so that she can move forward with her many different business pursuits."
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