Paul Pierce Settles with SEC Over Crypto Row
The Securities and Exchange Commission has charged former Boston Celtics player Paul Pierce for promoting the cryptocurrency EthereumMax on Twitter without disclosing that he was being paid to do so. To resolve these charges, Pierce has agreed to pay a fine of $1.1 million and around $240,000 in disgorgement and prejudgement interest.
SEC fines Paul Pierce $1.1M for promoting EthereumMax
The Securities and Exchange Commission has accused former NBA star and ESPN employee Paul Pierce of violating the federal Securities Act. The SEC claims that Pierce failed to disclose receiving compensation from a cryptocurrency company for promoting their product online and made money from "an untrue statement of a material fact".
The SEC further alleged that Pierce misled the public about his holdings of EMAX, sharing misleading screenshots of his EMAX holdings and profits. Also, he failed to disclose that his actual personal holdings were significantly lower.
He has been fined $1.1 million by the SEC for promoting cryptocurrency, EthereumMax (EMAX). This is the same security product that influencer Kim Kardashian was previously charged for touting.
The NBA star used Twitter to promote EMAX tokens without disclosing that he had received more than $244,000 in the cryptocurrency as payment for his promotions. He did not admit any wrongdoing as part of the settlement and has agreed to pay a $1.1 million penalty and disgorge around $240,000.
Furthermore, he has also been banned from promoting any crypto asset securities for three years, according to the SEC.
The SEC Chairman, Gary Gensler, said the case is a reminder to celebrities that the law requires them to disclose how much they are being paid to promote investment in securities. He added, "you can't lie to investors when you tout a security".
SEC has recently intensified its efforts to enforce regulations in the cryptocurrency industry. On Thursday, it charged Terraform, a stablecoin issuer, and its CEO, Do Kwon, with crypto fraud.
Author: Priya Kumari
Priya is a passionate content writer and the co-founder of Finendorse. She is an enthusiastic crypto investor and has a huge interest in the upcoming digitisation age.