Celebrities to Pay Heavy Fines for Promoting ICOs Without Disclosing Payments

Discussion in 'HardForum Tech News' started by cageymaru, Nov 30, 2018.

  1. cageymaru

    cageymaru [H]ard as it Gets

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    The Securities and Exchange Commission has settled charges against boxer Floyd Mayweather Jr. and music producer Khaled Khaled, known as DJ Khaled, for failing to disclose payments they received for promoting investments in Initial Coin Offerings (ICOs). Floyd Mayweather Jr. received $100,000 from Centra Tech Inc. and DJ Khaled received $50,000. DJ Khaled described the ICO as a "Game changer" and Floyd Mayweather promoted the launch of the Centra ICO to his followers as "starts in a few hours. Get yours before they sell out, I got mine..." Floyd neglected to mention that he was compensated an additional $200,000 for two other ICO promotions as he bragged, "You can call me Floyd Crypto Mayweather from now on." They were fined over $765,000 by the SEC and are currently banned from promoting securities in the near future.

    Without admitting or denying the findings, Mayweather and Khaled agreed to pay disgorgement, penalties and interest. Mayweather agreed to pay $300,000 in disgorgement, a $300,000 penalty, and $14,775 in prejudgment interest. Khaled agreed to pay $50,000 in disgorgement, a $100,000 penalty, and $2,725 in prejudgment interest. In addition, Mayweather agreed not to promote any securities, digital or otherwise, for three years, and Khaled agreed to a similar ban for two years. Mayweather also agreed to continue to cooperate with the investigation.

    "These cases highlight the importance of full disclosure to investors," said Enforcement Division Co-Director Stephanie Avakian. "With no disclosure about the payments, Mayweather and Khaled's ICO promotions may have appeared to be unbiased, rather than paid endorsements." "Investors should be skeptical of investment advice posted to social media platforms, and should not make decisions based on celebrity endorsements," said Enforcement Division Co-Director Steven Peikin.
     
  2. DeathFromBelow

    DeathFromBelow [H]ardness Supreme

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    Martha Stewart got jail time over less than $50k worth of insider trading...
     
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  3. gxp500

    gxp500 Gawd

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    Its pretty obvious why... the judge must of been black and threw the book at her. While Mayweather is black and got a slap on the wrist.

     
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  4. Ultima99

    Ultima99 [H]ardness Supreme

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    They didn't think to put a tiny watermark like "Paid promotional endorsement." in the corner?
     
  5. chappedstick

    chappedstick n00b

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    Martha Stewart was convicted of obstruction of justice, making false statements and conspiracy.
     
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  6. sfsuphysics

    sfsuphysics I don't get it

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    Well at least the fine was larger than their compensation, although not sure how much they made by their manipulation
     
  7. runudownquick

    runudownquick Gawd

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    Literally a half drop in the bucket for Mayweather & I doubt Khaled is going to lose sleep over the money lost either.
     
  8. collegeboy69us

    collegeboy69us [H]ardness Supreme

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    Isn't that the guy that can't read to save his life? I don't follow sports of any kind... but the name sounds familiar.

    Not sure about you guys, but you could park a few metric tons of money in front of me and say "this is yours if we can bash you in the head enough times to make you as stupid as this guy". I'd nope out of that pretty fast. I can't imaging not being able to read.
     
  9. cageymaru

    cageymaru [H]ard as it Gets

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    I'm just hoping that YouTube personalities and other social media celebrities hocking crap get busted for similar actions.
     
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  10. dandirk

    dandirk [H]ard|Gawd

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    I am all for disclosure regulations for things like this...

    But if you are taking advice on anything other than boxing from a boxer you sorta deserve what you get. Especially investment advice.
     
  11. sfsuphysics

    sfsuphysics I don't get it

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    Youtube "celebs" usually arent hocking investments though, so it is a FTC issue not SEC and the FTC isnt quite as harsh
     
  12. RealBeast

    RealBeast Gawd

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    Crypto! Bernie Madoff is probably bummed that he didn't think of a scam nearly that big. o_O
     
  13. motomonkey

    motomonkey [H]ard|Gawd

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    Holy fuck, I see posts like this and have to check the URL to make sure I didn't stumble in The Daily Stormer by accident.
     
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  14. Zarathustra[H]

    Zarathustra[H] Official Forum Curmudgeon

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    Yeah, that's unusual in the financial world.

    The big firms usually pay a few millions in fines for illegal behaviors that earned them billions.

    At that point it becomes a cost of doing business.
     
  15. DeathFromBelow

    DeathFromBelow [H]ardness Supreme

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    Sure, but she was also found not guilty of the more serious charge of securities fraud. I'm willing to bet they could have pushed conspiracy charges in this case.

    I just find it interesting that selling some stock based on insider info and telling investigators a story that doesn't add up resulted in jail time, but pushing a shitcoin scam on fans did not.
     
  16. chappedstick

    chappedstick n00b

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    The difference is they agreed with the penalties and have cooperated instead of trying their luck in federal court.