Lindsay Lohan And Ne-Yo were among a group of celebrities who were forced to pay tens of thousands of settlements following claims that they promoted crypto investments on social media without explaining that they were paid advertisements.
The cohort of famous faces included boxer and internet personality Jack Paulrapper Lil Yachty and adult film star Michelle Mason.
It was reported that all the celebrities agreed to pay more than £325,000 to the US Securities and Exchange Commission (SEC) after being paid to promote entrepreneur Justin Sun’s crypto companies – Tronix and BitTorrent – to their millions of online followers.
Despite paying the fines, none of the stars have since admitted or denied the SEC’s findings, according to Sky News.
However, the outlet reported that two other celebrities — pop singer Austin Mahone and rapper Soulja Boy — have not paid a settlement amount to the SEC.
After announcing her pregnancy last week, Lindsay’s spokesperson revealed that the actress was first contacted in March 2022 and was unaware at the time of posting to warn followers that she was being paid.
The Hollywood actress then repaid the £8,141 she paid to promote the companies plus interest and also paid a further £24,425 in fines.
SEC Chairman Gary Gensler said in a statement, “This case demonstrates once again the risk investors face when crypto asset securities are offered and sold without proper disclosure.
‘As claimed, [Justin] Sun and his companies [Tronix and BitTorrent] not only targeting US investors in their unregistered offerings and sales generating millions in illicit proceeds at the expense of investors, but they also coordinated wash trading on an unregistered trading platform to create the misleading appearance of actively trading TRX .
“Sun further pushed investors to buy TRX and BTT by staging a promotional campaign in which he and his celebrity promoters hid that the celebrities were being paid for their tweets.”
This was not the first time major public figures promoted cryptocurrencies to their online platform followers.
The group of stars facing fines was actually following in the footsteps of TV royalty Kim Kardashian when she ran into trouble with regulators for failing to state that she was being paid to recommend Ethereum Max tokens.
Last year, the founder of Skims paid a fine of £813,635 to settle federal costs incurred because she failed to declare that her mail was making her money.
In 2020, actor Steven Seagal was banned from advertising investments on social media for three years and had to pay £244,102 in fines as part of a similar settlement case.
Metro.co.uk has reached out to all the celebrities mentioned for comment.
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