blockmanity.com
Professional boxer Floyd Mayweather and popular music producer DJ Khaled were charged by the Securities and Exchange Commission (SEC) for promoting fraudulent ICO’s. It becomes the first case by the SEC in terms of penalizations concerning ICO’s.
Both the known personalities have helped promote the ICO’s through social media and amongst their die-hard fans in exchange for cash. Mayweather is reportedly said to receive $300,000 from three ICO’s which include Centra Tech, Hubii, and Stox while DJ Khaled is said to have got $50,000 from Centra tech. Both the celebrities did not disclose their payments for promoting these ICO’s.
Floyd Mayweather had even gone to the extent of tweeting his followers to call him Floyd Crypto Mayweather while promoting Hubii.
You can call me Floyd Crypto Mayweather from now on #HubiiNetwork #ICO starts tomorrow! Smart contracts for sports?! #CryptoMediaGroup #ad🤑 pic.twitter.com/25GoMPuS7r
— Floyd Mayweather (@FloydMayweather) August 23, 2017
In May 2018, the founders of Centra were indicted for misleading investors into a fraud. A total of $32 million was raised from investors in 2017. The company falsely claimed to have partnered with Visa Mastercard to issue virtual currency debit cards.
Mayweather agreed to pay $300,000 in disgorgement, $300,000 penalty and $14,775 in prejudgement interest. Khaled will be paying $50,000 in disgorgement, $100,000 penalty and $2,725 in prejudgment interest.
Blockmanity Take
It looks like Mayweather and Khaled won’t be seen promoting ICO’s for a while. Mayweather has agreed to collaborate with the investigation and not promote any securities for three years. While DJ Khaled won’t even be able to utter a single word of Cryptocurrencies in any promotions let alone his songs for the next two years.
With the SEC paying close attention celebrities may think twice before promoting ICO’s.