Several celebrities like actress Lindsay Lohan and rapper Akon, among others will pay tens of thousands of dollars to settle claims that they promoted crypto investments to their millions of social media followers without disclosing they were being paid to do so. Recording artists Ne-Yo and Lil Yachty, boxer and internet personality Jake Paul, and adult film performer Michele Mason were also among those who agreed to pay more than 400,000 dollars combined in disgorgement, interest and penalties to settle the claims.

The Illegal Promotion of Cryptocurrencies By Celebrities

Many celebrities and athletes have used their influence and massive social media followings to promote cryptocurrencies in recent years, including Matt Damon, Tom Brady and Reese Witherspoon. However, doing so without disclosing when they are being paid to do so is illegal, and has landed some big names in hot water with securities regulators.

SEC Complaint filed on Celebrities Promoting Crypto Asset Securities without Disclosure

In the complaint filed by the Securities and Exchange Commission (SEC) in a 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. Mr 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.

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