Lindsay Lohan, Jake Paul face SEC charges over crypto ads

Comment

The Securities and Exchange Commission said Wednesday that a handful of celebrities — including Internet sensation-turned-professional boxer Jake Paul and actress Lindsay Lohan — promoted cryptocurrencies without disclosing that they were compensated for doing so.

Ball, Logan, former Dean heartthrob Austin Mahone and rapper Soulja Boy (whose legal name is DeAndre Cortez Way) are among the SEC’s eight celebrities. said Illegally promoted cryptocurrencies Tronix (TRX) and BitTorrent (BTT).

The SEC charged businessman Justin Sun and his three companies for the “unregistered offer and sale” of TRX and BTT.

The complaint, filed Wednesday in the U.S. District Court for the Southern District of New York, also alleges that Sun “performed manipulative wash trading of TRX to create the artificial appearance of legitimate investor interest and to keep the price of TRX afloat.” In this the securities are essentially traded simultaneously between related companies, so that the asset “appears to be actively traded without an actual change in beneficial ownership.”

Sun — a Chinese businessman who holds citizenship in the small island nation of Grenada — which grants citizenship to big investors in the West Indies — gained global attention in 2019 after paying $4.6 million to have lunch with Warren Buffett. But canceled it after apologizing for “excessive self-promotion”.

Instead of lunching with Warren Buffett, Chinese entrepreneur Justin Sun is eating humble pie

The SEC reported that celebrity promotional messages about cryptocurrencies were posted on social media. Logan, who has more than 8 million Twitter followers, tweeted on February 11, 2021 that he “already likes” three of Sun’s cryptocurrencies, including TRX. “Super fast and 0 fees,” she said wrote. “Good job @justinsuntron.”

See also  Gaza's biggest hospital 'inoperative' amid Israeli attack

In March 2021, she promotion Bidding – in TRX – for an NFT or non-fungible token of one of his songs. “9 hours left to bid!” she He tweeted that On April 1, 2021.

Paul and Logan — along with rapper Lil Yachty (whose legal name is Miles Parks McCallum) — are among six celebrities who have pleaded not guilty and agreed to pay a total of more than $400,000; Mahon and Soulja Boy were not named in the complaint.

Reps for Logan, Paul, Mahone, Soulja Boy and Lil Yachty did not respond to requests for comment. Grenada’s foreign ministry, which appointed Sun as a WTO ambassador in 2021, did not respond to requests for comment, saying the SEC is wholly owned by Sun.

These are not the SEC’s first actions against celebrities accused of illegally promoting cryptocurrencies. Kim Kardashian agreed to pay $1.26 million to settle SEC charges last year after promoting EthereumMax (EMAX) on social media.

Kim Kardashian to pay $1.26 million in SEC crypto lawsuit

According to the cryptocurrency site, the SEC issued a legal notice to Coinbase on Wednesday. Coinbase said it received a “Wells Notice” warning of impending charges. The SEC “told us they found potential violations of securities law, but little else. We specifically asked the SEC to identify which assets on our platforms they believed might be securities, and they refused to do so,” wrote Paul Grewal, Coinbase’s chief legal officer. Blog. The SEC did not immediately respond to a request for comment.

The charges, if brought, would be the most significant regulatory action against Coinbase, which has positioned itself as the responsible adult in the room as other crypto platforms — namely FTX — have collapsed.

See also  A 48-hour storm could leave the Twin Cities with 6-10 inches of snow

Leave a Reply

Your email address will not be published. Required fields are marked *