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SEC Settles with Floyd Mayweather and DJ Kahlid after Promotion of ‘Security Tokens’

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SEC Settles with Floyd Mayweather and DJ Kahlid after Promotion of 'Security Tokens'

Celebrities in the crosshairs SEC lands knockout blow

The SEC continues to broaden their mission of cracking down on securities crimes.  In recent news, it has come to light that boxing great, Floyd Mayweather, along with celebrity, DJ Kahlid, has come to a settlement.

Both individuals were accused of illegally promoting various ICOs throughout the summer of 2018.  Unfortunately for the duo, they did not disclose to potential investors that they were actually paid to do so.  By omitting this fact, this means they were in breach of long-standing securities laws.

Terms of the settlement indicate that although neither will plead guilty, or admit fraud, a financial fee will be paid.

Steven Peikin of the SEC, stated, “With no disclosure about the payments, Mayweather and Khaled’s ICO promotions may have appeared to be unbiased, rather than paid endorsements…Social media influencers are often paid promoters, not investment professionals, and the securities they’re touting, regardless of whether they are issued using traditional certificates or on the blockchain, could be frauds.”

Floyd Mayweather

Mayweather is a United States boxer that will go down as one of the greatest of all time.  He is an individual known for a persona outside of the ring, as big as his presence within it.

The charges laid against Mayweather total $600,000 due to his involvement in 3 ICOS.  His involvement saw him on the receiving end of $300,000 for his endorsement of the platforms.

DJ Kahlid

Although his name may be more obscure than that of Mayweather’s, Kahlid is certainly an influencer on social media.  As such, he found himself in the same situation as Mayweather – Promote an ICO and receive a hefty payday.

Unfortunately, he also failed to disclose this fact to investors.  As Kahlid only took part in endorsing one ICO, settlement charges for him rang in at $150,000.

SEC not just targeting ICOs

This targeting of ICO promoters comes on the heels of the SEC broadening their mission.  In recent weeks we have seen the SEC branch out from charging not only token issuers themselves, but exchanges that have facilitated the trade of said tokens.

It is reasonable to assume that if the SEC has a foot to stand on, they will continue to charge anyone they can with relations to fraudulent securities.

Pop Culture Prevalence

With this case against Mayweather and Kahlid, there are sure to be various other celebrities resting uneasy of late.  Other celebrities known to have endorsed or promoted ICOs in recent times include, but are not limited to the following.

  • Jamie Foxx
    • Cobinhood
  • The Game
    • Paragon
  • Paris Hilton
    • Lydian

In the cases of Mayweather and Kahlid, per terms of the settlement, the duo are banned from promoting any form of security for 3 years.  Not that they would have any interest in doing so now, anyways.

 

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Joshua Stoner is a multi-faceted working professional. He has a great interest in the revolutionary 'blockchain' technology. In addition to this, he is a licenced Paramedic in Nova Scotia, Canada. As such, he can provide emergency care/medicine to any situation necessitating it.

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