The Securities and Exchange Commission charged Kim Kardashian with failing to disclose that she was paid to tout the crypto asset EthereumMax on Instagram.
The case was settled recently when Kardashian agreed to pay a $1.26 million fine in settlement over the case. She has also said she will cooperate with the SEC in its ongoing investigations.
According to an account of the case on CNN Business, Gary Gensler, Chairman of the SEC said of influencers and celebrities:
“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.”
Kardashian has not admitted or denied any wrongdoing, but she has agreed to pay the very large fine, and has also forfeited the $250,000 plus interest she originally received for touting the crypto asset on Instagram. She has also agreed not to promote any cryptocurrencies for the next three years.
Gensler obviously wanted to make a very public statement on the Kardashian case and made a video which was published on the SEC YouTube channel.
The video, which came under the series “Office hours with Gary Gensler”, might be dubbed as extremely corny by those who have seen it. It appeared to be an attempt to target quite a young audience given the rather paternalistic style of the video.
It’s also to be wondered if the target audience would be faithfully watching videos put out by the chairman of the SEC, but Gensler was unperturbed and spoke slowly and clearly to his audience, saying such nuggets of wisdom as “a celebrity or influencer’s incentives aren’t necessarily aligned with yours”.
Another particularly well thought out line was Gensler’s comment on how TV or sports stars might not have the skills to offer investment advice:
“We might enjoy watching a celebrity playing on a basketball court, starring in a reality TV show or a movie, or performing to a large crowd at a stadium show. We shouldn’t confuse those skills though with the very different skills needed to offer appropriate investment advice.”
Gensler’s video had more than 2500 views at time of going to press. It is to be hoped that many more young viewers will go to see what Gary has to say, and that they will take more care with their investments, especially when it comes to cryptocurrencies, because Mr Gensler is always telling us how risky these investments might be.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
