Kim Kardashian To Pay $1.26 Million Fine From SEC For Not Disclosing Paid Crypto Promotion

The Securities and Exchange Commission has charged Kim Kardashian for promoting a cryptocurrency asset without disclosing the $250,000 she was paid for the post.

Critics have called the asset, EthereumMax, a “pump and dump” scheme. The term refers to scammers boosting a stock by spreading misleading information and then selling their shares at an inflated price.

In Kardashian’s June 13, 2021 promotional Instagram post, the reality star wrote, “Are you guys into crypto? This is not financial advice but sharing what my friend told me about the ethereum max token!” She also included a link where her millions of followers could learn how to purchase EMAX tokens.

According to the SEC, The Kardashians star has “agreed to settle the charges, pay $1.26 million in penalties, disgorgement, and interest, and cooperate” with the investigation. In addition, she will not advertise any crypto asset securities for the next three years.

The government agency noted that Kardashian paid the fine “without admitting or denying the SEC’s findings.”

A spokesperson for the SKIMS founder said in a statement, “Ms. Kardashian is pleased to have resolved this matter with the SEC. 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.”

They added, “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.”

SEC Chair Gary Gensler had a warning message for investors following the charges against Kardashian. “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,” he explained.

Gensler emphasized, “We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”

Forbes estimates Kardashian’s current net worth to be about $1.8 billion, so presumably, $1.26 million isn’t too daunting for her.