SEC Issues a Fresh Warning to Celebrities Promoting Crypto Projects
- Paul Pierce, a former NBA star, was charged by the SEC for inappropriately promoting EMAX tokens on social media. Pierce agreed to resolve the charges.
- The SEC charged Kim Kardashian with a similar case last year.
Paul Pierce, a former NBA player, has agreed to a $1.4 million settlement with the US Securities and Exchange Commission over allegations that he used social media to advertise a cryptocurrency project. Pierce allegedly failed to declare that he got more than $244,000 in EthereumMax (EMAX) in exchange for tweeting about the asset.
As part of the agreement, Pierce agreed not to promote any cryptocurrency projects deemed to be securities for a period of three years. Reacting to the situation, Gurbir Grewal, the director of SEC enforcement, said, “Investors are entitled to know whether a promoter of a security is unbiased, and Mr. Pierce failed to disclose this information.”
The SEC, led by Gary Gensler, has carried out a series of raids against crypto projects in recent weeks as it continues its move to regulate the sector. Gensler noted that the latest action against Pierce “is yet another reminder to celebrities: The law requires you to disclose to the public from whom and how much you are getting paid to promote investment in securities, and you can’t lie to investors when you tout a security.”
This will not be the first time the SEC has targeted celebrities promoting EthereumMax tokens. In October 2022, Kim Kardashian and the SEC announced a $1.2-million settlement after she failed to declare a $250,000 payment to post an Instagram story advertising EMAX tokens.
Notable names such as Floyd Mayweather also helped promote EMAX. However, some users claimed they had been scammed and sued the celebrities backing the project. The lawsuit was later dismissed.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
