Federal securities regulators on Friday charged former NBA player Paul Pierce with violating anti-fraud and advertising laws. Promote cryptocurrency on your social media accounts without disclosing that you have been paid for it.
Pierce earned more than $244,000 at EMAX Send EthereumMax tokens to your Twitter account, US Securities and Exchange Commission investigators said. According to the SEC, Pierce misled the public about the performance of digital token investments when he tweeted a photo of his lucrative account, even though his personal portfolio was not performing well.
Pierce agreed to settle the lawsuit by paying $1.4 million in penalties, damages and interest without "admitting or denying the SEC's findings." Peers also agreed not to make any crypto-asset announcements for three years.
A representative for Pierce did not respond to a request for comment Friday.
Pierce is an NBA Hall of Famer from California who played 19 seasons mostly with the Boston Celtics. We're talking about the tweet he posted in May 2021 after he was fired from ESPN.
"I don't need ESPN. I have Ethereum Max," Pearce tweeted. "Last month with you I made more money with this cryptocurrency than I made in a year. Last hour."
The cryptocurrency industry has come under scrutiny from financial regulators in recent months as investors have begun losing billions of dollars in assets due to account fraud or hacking. After FTX Trading filed for bankruptcy last November, the spotlight got even hotter after it entered the crypto version of Bank Run. Since the FTX collapse, Washington lawmakers have renewed calls for regulation of the industry.
To be clear, Pierce isn't the first celebrity to promote cryptocurrency and pay a fine for it. Kim Kardashian agreed to a $1.26 million settlement with the SEC in October over the same EMAX cryptocurrency. Like Pierce, he also agreed not to promote cryptocurrency for three years.
Other celebrities who have publicly endorsed various digital currencies include Matt Damon, Paris Hilton, Jamie Foxx, Ashton Kutcher, Gwyneth Paltrow and Dennis Cole, better known as Ghostface Killah of the Wu-Tang Clan.
"This case is another stark reminder that the law requires that you cannot lie to investors about how much money you are paid to promote investments in securities and promote stocks," SEC Chairman Gary Gensler said. Take notes. "When celebrities endorse investment opportunities, including crypto stocks, investors should be careful to determine if the investment is right for them and why the celebrity is making such an endorsement."
Pierce, Kardashian and boxer Floyd Mayweather were named as defendants in a class action lawsuit filed by crypto investors against Ethereum Max last year.
In the year In 2018, Mayweather and music producer DJ Khaled agreed with the SEC to promote cryptocurrencies.