Former NBA player Paul Pierce agrees to settle with SEC for misleading crypto investment promos
Former National Basketball Association player Paul Pierce has agreed to settle with the Security Exchange Commission (SEC) for promoting EthereumMax (EMAX) tokens without disclosing that he received payment in return.
On Friday, the SEC stated that Pierce earned $244,000 in EMAX tokens without disclosing the payments while advertising it on Twitter. Additionally, he allegedly simulated having a considerable amount of EMAX tokens via screenshots—even though his actual holdings were significantly lower than depicted. As a result of this fraudulent behavior, Pierce will be paying the sum of $1.409 million for penalties and disgorgement. According to a statement released by the SEC, the NBA Hall Of Famer has agreed not to promote any crypto asset securities within three years from now.
The SEC’s recent settlement with Kim Kardashian emphasizes the need for celebrities to disclose their payments when promoting investments. In a statement, Chair Gary Gensler highlighted that “this is just another reminder,” emphasizing why revealing any financial gain from promotion is so important.
Notably, Kim Kardashian paid $1.26 million as part of an agreement after failing to expose her own payment of $250,000 for endorsing EthereumMax cryptocurrency on social media channels without making appropriate disclosures about the finances involved in the endeavor.
“No truth-twisting is allowed when talking about security. If famous individuals promote investment opportunities, including digital asset securities, investors must vet them thoroughly and understand why these celebrities are making those endorsements.”
Gary Gensler, SEC Chair
The SEC’s latest action came after it filed a lawsuit against Terraform Labs and its founder, Do Kwon, for fraudulent activities and the sale of unauthorized securities. As per the complaint, almost all aspects of Terra were included in purported security regulation violations, such as the Anchor protocol, which provided interest-bearing yields, along with various tokens issued by Terraform.
The regulatory agency has taken firm measures recently, settling charges with Kraken crypto exchange only last week and gearing up to take legal steps against Paxos stablecoin issuer over their Binance USD token.
