Lil Yachty, Soulja Boy, Akon, and Ne-Yo, are among a group of celebrities the Securities and Exchange Commission (SEC) charged with promoting cryptocurrencies without disclosing they were being paid to do so, AllHipHop reports.
According to the report, the other stars named in an SEC press release shared on Wednesday, March 22 are Lindsay Lohan, Jake Paul, Austin Mahone, and Michele Mason.
They were charged with “illegally touting” TRX and/or BTT, crypto asset securities Tronix (TRX), and BitTorrent (BTT). The SEC also announced charges against crypto asset entrepreneur Justin Sun and three of his companies “for the unregistered offer and sale,” of the above crypto asset securities.
The companies are Tron Foundation Limited, BitTorrent Foundation Ltd., and Rainberry Inc. (formerly BitTorrent). Justin Sun and his companies faced further charges for “fraudulently manipulating the secondary market for TRX through extensive wash trading.”
The SEC also alleges that Sun violated the anti fraud and market manipulation provisions of the federal securities laws. They claimed he planned to artificially inflate the trading figures of TRX in the secondary market. In addition, they accuse him of planning a scheme to pay celebrities to tout TRX and BTT without disclosing their compensation.
All of the celebs, save Cortez Way and Mahone, agreed to pay up more than $400,000 in disgorgement, interest, and penalties to settle the charges. They will not have to admit or deny the allegations.
“This case demonstrates again the high risk investors face when crypto asset securities are offered and sold without proper disclosure,” said SEC Chair Gary Gensler