Kim Kardashian is in trouble with the Securities and Exchange Commission for promoting cryptocurrency and has agreed to pay a $1.26 million fine because of it.
The 41-year-old reality star used Instagram to promote EMAX crypto tokens, a digital coin that was offered for sale by EthereumMax, The New York Post reported. Now the SEC is asserting that Kardashian “failed to disclose” that she was paid $250,000 to post the promo to her 331 million followers on the platform.
The SEC announced Monday that the star was charged “for touting on social media a crypto asset security … without disclosing the payment she received for the promotion,” the publication reported. They further noted that she had “agreed to settle the charges, pay $1.26 million in penalties, disgorgement, and interest, and cooperate” with the ongoing investigation.
“Kardashian’s post contained a link to the EthereumMax website, which provided instructions for potential investors to purchase EMAX tokens,” the SEC said in a statement.
“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,” SEC Chair Gary Gensler said of the incident.
Kardashian is ponying up the money “without admitting or denying the SEC’s findings,” the agency noted. She’s also agreed not to promote crypto asset securities for at least three years.
A spokesperson told The Post in a statement that, “Ms. Kardashian is pleased to have resolved this matter with the SEC,” going on to say how she “fully cooperated” with the agency from the start.
Kardashian is well known for making money from sponsored Instagram posts, and that income stream is more significant than most fans realize.
“My daughters are constantly getting offers to post something for a company, or a brand, on social media,” momager Kris Jenner told CBS This Morning during a 2019 interview. “They have a fee for a post, or a fee for a story, a fee for Facebook … they have a fee schedule.”
“It’s definitely six figures,” Jenner clarified.
Though fans have been critical of these kinds of posts, Kardashian defended herself saying, “You’re going to get backlash for almost everything so as long as you like it or believe in it or it’s worth it financially, whatever your decision may be, as long as you’re O.K. with that,” she told The New York Times in 2019 of doing sponsored posts.
