US reality star Kim Kardashian has agreed to pay a $1.26 million fine after unlawfully pushing a cryptocurrency on Instagram without revealing that she was paid to do so, the Securities and Exchange Commission announced Monday.
The agency accused Kardashian, who has 331 million followers on Instagram — making her one of the top ten most followed people on the global social network — of failing to disclose that she was paid $250,000 to post about EMAX tokens, the crypto asset security being offered by EthereumMax.
The fine includes a penalty of $1 million plus $260,000, representing the amount Kardashian paid plus interest, the SEC said in a statement. She also agreed not to promote any crypto asset securities for three years.
“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 in the statement.
“We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”
Reality-star-turned entrepreneur Kardashian came to fame with the US reality show “Keeping Up With the Kardashians,” which tracked the lives of her family members in Los Angeles.
The 41-year-old has steadily built her business empire in recent years — most visibly with her apparel and beauty brands — and has a net worth of $1.8 billion, according to Forbes.
She announced last month that she was branching into a new business arena with the launch of a private equity firm SKKY Partners.
Other celebrities have been nabbed in the past by US authorities for illegally promoting cryptocurrencies, including boxer Floyd Mayweather, rap star DJ Khaled, actor Steven Seagal and rapper T.I.