United States Judge Dismissed Lawsuit on Billionaire Kim Kardashian & American Boxer Floyd Mayweather Over Alleged Crypto Scam for Unclear Filing Claims, Investors May Amend & Refile Class Action
17th December 2022 | Singapore
The United States court judge has dismissed the lawsuit on celebrity & billionaire Kim Kardashian & American boxer Floyd Mayweather over alleged crypto scam for unclear filing claims – “it is unclear that the investors who sued actually saw the promotions.” The United States district court judge Michael Fitzgerald (Los Angeles) in the ruling, told the investors “may amend and refile their proposed class action.” See below for original filing. In October 2022, the United States Securities & Exchange Commission (SEC) has find Hollywood celebrity Kim Kardashian $1.26 million for promoting crypto asset security by EthereumMax on social media, without disclosing $250,000 payment received for her to publish a post on her Instagram with 331 million followers. Kardashian’s post contained a link to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens. More info below.
“ United States Judge Dismissed Lawsuit on Billionaire Kim Kardashian & American Boxer Floyd Mayweather Over Alleged Crypto Scam for Unclear Filing Claims, Investors May Amend & Refile Class Action “
Kim Kardashian has around 279 million Instagram followers while Floyd Mayweather has 27 million followers. Celebrity Kim Kardashian who has an estimated fortune of more than $1 billion, can command a fee ranging from $500k to over $1 million for a sponsored Instagram post. In 2018, Floyd Mayweather, who has an estimated fortune around $450 million, was charged by the United States Exchange Commission for pumping up an initial coin offering, and settled $600,000 with United States SEC.
Celebrity & Billionaire Kim Kardashian and American Boxer Floyd Mayweather Sued by Investors Over Alleged Crypto Scam
14th January 2022 – Celebrity & billionaire Kim Kardashian and American Boxer Floyd Mayweather had been sued by investors over an alleged crypto scam, where they had made false or misleading statements to promote investing into EthereumMax cryptocurrency through paid (sponsored) social media posts to millions of their followers. Kim Kardashian has around 279 million Instagram followers while Floyd Mayweather has 27 million Instagram followers. The cryptocurrency EthereumMax had lost 97% of its value since June 2021, with some investors labelling this as a “pump and dump” scheme – where prices are being hyped or pushed up for scammers or syndicates to sell their holdings at a higher price, and thereafter causing the price to crash. Celebrity Kim Kardashian who has an estimated fortune of more than $1 billion, can command a fee ranging from $500k to over $1 million for a sponsored Instagram post. In 2018, Floyd Mayweather, who has an estimated fortune around $450 million, was charged by the United States Exchange Commission for pumping up an initial coin offering, and settled $600,000 with United States SEC. The case was filed as a proposed class action on behalf of investors who bought EthereumMax tokens from mid-May to late June 2021.
Kim Kardashian has around 279 million Instagram followers while Floyd Mayweather has 27 million followers.
Celebrity Kim Kardashian who has an estimated fortune of more than $1 billion, can command a fee ranging from $500k to over $1 million for a sponsored Instagram post. In 2018, Floyd Mayweather, who has an estimated fortune around $450 million, was charged by the United States Exchange Commission for pumping up an initial coin offering, and settled $600,000 with United States SEC.
United States SEC Fines Kim Kardashian $1.26 Million for Promoting Crypto Asset EthereumMax on Social Media, Without Disclosing $250,000 Payment to Publish Post on Instagram with 331 Million Followers
6th October 2022 – The United States Securities & Exchange Commission (SEC) has fined Hollywood celebrity Kim Kardashian $1.26 million for promoting crypto asset security by EthereumMax on social media, without disclosing $250,000 payment received for her to publish a post on her Instagram with 331 million followers. Kardashian’s post contained a link to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens. SEC Chair Gary Gensler: “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. We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals. Ms. Kardashian’s case also serves as a reminder to celebrities and others that the law requires them to disclose to the public when and how much they are paid to promote investing in securities.” Gurbir S. Grewal, Director of the SEC’s Division of Enforcement: “The federal securities laws are clear that any celebrity or other individual who promotes a crypto asset security must disclose the nature, source, and amount of compensation they received in exchange for the promotion. Investors are entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information.” See United States SEC statement below.
United States SEC statement on Kim Kardashian
SEC Charges Kim Kardashian for Unlawfully Touting Crypto Security
The Securities and Exchange Commission today announced charges against Kim Kardashian for touting on social media a crypto asset security offered and sold by EthereumMax without disclosing the payment she received for the promotion. Kardashian agreed to settle the charges, pay $1.26 million in penalties, disgorgement, and interest, and cooperate with the Commission’s ongoing investigation.
The SEC’s order finds that Kardashian failed to disclose that she was paid $250,000 to publish a post on her Instagram account about EMAX tokens, the crypto asset security being offered by EthereumMax. Kardashian’s post contained a link to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens.
“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,” said SEC Chair Gary Gensler. “We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”
“Ms. Kardashian’s case also serves as a reminder to celebrities and others that the law requires them to disclose to the public when and how much they are paid to promote investing in securities,” Chair Gensler added.
“The federal securities laws are clear that any celebrity or other individual who promotes a crypto asset security must disclose the nature, source, and amount of compensation they received in exchange for the promotion,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement. “Investors are entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information.”
The SEC’s order finds that Kardashian violated the anti-touting provision of the federal securities laws. Without admitting or denying the SEC’s findings, Kardashian agreed to pay the aforementioned $1.26 million, including approximately $260,000 in disgorgement, which represents her promotional payment, plus prejudgment interest, and a $1,000,000 penalty. Kardashian also agreed to not promote any crypto asset securities for three years.
The SEC’s investigation, which is continuing, is being conducted by Jon A. Daniels, Alison R. Levine, and Pamela Sawhney of the Enforcement Division’s Crypto Assets and Cyber Unit, and Kerri Palen, Lisa Knoop and Victor Suthammanont of the New York Regional Office. The case was supervised by Mark R. Sylvester of the Crypto Assets and Cyber Unit and Carolyn Welshhans.
The SEC’s statement urging caution regarding potentially unlawful celebrity-backed crypto asset offerings can be found here. SEC Chair Gensler today published a videowarning investors not to make investment decisions based solely on the recommendations of a celebrity or influencer.
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