Actor Lindsay Lohan, rapper Akon and several other celebrities have agreed to pay tens of thousands of dollars to settle claims they promoted crypto investments to their millions of social media followers without disclosing they were being paid to do so.
Lohan, Akon, recording artists Ne-Yo, and Lil Yachty, boxer and internet personality Jake Paul, and adult film performer Michele Mason agreed to pay more than $US400,000 ($600,000) combined in disgorgement, interest and penalties to settle the claims, the Securities and Exchange Commission said Wednesday.
None admitted or denied the SEC’s findings as part of the settlement. Two other celebrities named in the SEC’s complaint, rapper Soulja Boy and pop singer Austin Mahone, did not reach a settlement with the SEC, the agency said.
In response to a request for comment, Lohan’s publicist Leslie Sloane said the actor was contacted in March 2022, was unaware of the disclosure requirement, and agreed to pay a fine to resolve the matter.
Lohan, who last week announced she is pregnant, was called to give up the $US10,000 she was paid, plus interest, and pay a $US30,000 fine, according an SEC complaint.
A spokeswoman for Paul declined to comment. Emails left with representatives for the other celebrities named in the SEC complaint weren’t immediately returned on Wednesday.
In the SEC complaint filed in federal court in New York, the agency claims the celebrities were paid to promote Tronix (TRX) and BitTorrent (BTT), both crypto asset securities that were offered for sale by three companies owned by Justin Sun, a Chinese national.
Starting about August 2017, Sun allegedly offered to sell billions in the unregistered securities and engaged in manipulative trading, while also creating secondary markets on which Tronix and BitTorrent could be traded, according to the complaint.
“Although the celebrities were paid to promote TRX and BTT, their touts on social media did not disclose that they had been paid or the amounts of their payments,” according to the complaint.
“Thus, the public was misled into believing that these celebrities had unbiased interest in TRX and BTT, and were not merely paid spokespersons.”
In January last year, influencer Kim Kardashian, boxer Floyd Mayweather Jr and basketball player Paul Pierce and EthereumMax’s creators were sued by investors.
In October, Kardashian agreed to pay a $US1.26 million ($1.96 million) fine related to charged that she failed to disclose payment for a social media post about EthereumMax’s EMAX tokens.
Kardashian has agreed to not promote any crypto asset securities for three years.
– AAP
