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India’s securities and commodity market regulator, the Securities and Exchange Board of India (SEBI), has called for no celebrity endorsements of cryptocurrency products. Should they continue to endorse, they shall be held responsible for the possible violation of the local consumer act.
India Wants to Ban Crypto Celebrity Endorsements
According to an exclusive local media report, prominent figures like celebrities, sportsmen, and others should not endorse crypto products and the advertising disclosure should also talk about the possible violation of laws.
“Given that crypto product are unregulated, prominent public figures including celebrities, sportsmen, etc. or their voice shall not be used for endorsement/advertisement of crypto products,” a source from SEBI told the media outlet.
The report further adds that the prominent public figure shall be held responsible for endorsing crypto products which is a possible violation of the Consumer Protection Act or any other law, 'dealings in crypto products may lead to prosecution for possible violation of Indian laws such as FEMA, BUDS Act, PMLA, etc,' the report quoted.
Penalty for Violations
The Consumer Protection Act (CCPA), 2019, also firmly puts the onus of due diligence on the celebrities for claims in all ads. For instance, if an advertisement is found to be false or misleading, the Central Consumer Protection Authority can issue directions to discontinue or modify the ad to the concerned manufacturer or celebrity endorsers of the product. The CCPA can also levy a penalty of up to INR 10 lakh on the celebrity endorser for a false or misleading ad in the first instance. Penalties can go up to INR 50 lakh for any further instances of false and misleading claims in ads. It can also prohibit celebrities from endorsing any other products for up to three years.