Accused of having carried out covert advertising for a cryptocurrencyKim Kardashian agreed to pay a fine of 1.26 million dollars.
The American reality star was pinned on Monday by the Security and Exchange Commission (SEC) for a post promoting an Ethereum product without mentioning that she was paid to do so. In addition to being an unfair practice, the SEC considers that this kind of promotion helps to artificially inflate the value of these decentralized currencies.
A publication paid at 250,000 dollars
In June 2021, Kim Kardashian promoted Ethereum max on Instagram. An announcement that is not trivial for this influencer who still has 331 million subscribers on Instagram. Accompanied by a link to the Ethereum Max site, which gives investment advice in crypto, this publication however lacked crucial information: the mention that it was a paid partnership.
The best known of the Kardashians would have received $ 250,000 for this publication alone. What the SEC, the American policeman of the financial markets ended up discovering after a few months. To avoid a lawsuit, the star admitted having been remunerated, agreed to pay a fine amounting to 1.26 million dollars and is now cooperating with the American justice within the framework of a broader investigation into the fraud linked to the cryptocurrencies. She has also pledged to stop advertising any active crypto for a minimum of three years.
Financial advice from influencers, a real problem for the SEC
Gary Gensler, the chairman of the SEC, took advantage of this case to remind that influencers are rarely experts in financial advice, and that the “good plans” they promote do not correspond to all investors.
This is not the first case of its kind, indeed. American stars with millions of subscribers had already tried their hand at more or less disguised advertising for crypto-currencies, such as boxing star Floyd Mayweather. The American regulatory authority points out, however, that the promotion of these products by influential people who are completely foreign to the environment, ” contributes to artificially inflate the value of these financial assets “.
Source : Tech Crunch, Le Figaro
19