Floyd Mayweather paid $600,000 in a settlement against SEC charges, who’s next?

SEC issued a public statement in November of 2017 warning individuals promoting investment vehicles such as stocks, ICOs, cryptocurrencies and other investments without disclosing their compensation arrangements.

Specifically, SEC stated that “these endorsements may be unlawful if they do not disclose the nature, source, and amount of any compensation paid, directly or indirectly, by the company in exchange for the endorsement.”

The operating word here is ‘disclose’.

Interestingly, providing a ‘disclaimer’ stating that ‘I am not a financial advisor and do not rely on my opinion’ is not enough. You have to disclose if you are being compensated for promoting / shilling.

Cryptotapas has not endorsed any project because someone offered financial incentives. We have always picked projects that personally interested us and we share what we come across during our research it leads us to either invest or ignore a particular project.

That is not the case for many social media influencers.

Many backroom deals are entered into before an influencer talks about a project, all without disclosing that they are being compensated.

According to Doug Polk’s YouTube Video, Suppoman was caught on live video when a message from Indahash team offering 2 BTC popped up on his screen, in the video, we can see that Suppoman immediately reacts “Oops, you didn’t see that”. Suppoman later denied having anything to do with shilling the project for money. It would be interesting to see influencers in such a predicament would be bought under investigation, and if so, how? Suppoman does not live in the United States, he lives in the United Kingdom.

In another case, a letter made circles in the crypto community talking about corruption (or insider trading of sorts) involving Ian Balina. It would be interesting to see if this alleged shill will come to light and what action this will result in. According to his LinkedIn page, Ian Balina lives in Washington DC.

On November 29, 2018, SEC settled charges with Floyd Mayweather Jr. and Khaled Khaled (DJ Khaled), “for failing to disclose payments they received for promoting investments in Initial Coin Offerings (ICOs).” Mayweather paid $614775 and Khaled settled $157,725, without admitting or denying the findings to settle the charges by SEC. This latest action re-triggered the discussion about SEC going after social media influencers who hid their private dealings about getting compensated for promoting / shilling a particular project is what is going to be the hot topic going into 2019.

Will SEC take the same route of imposing penalties against the social media influencers who concealed the information about being compensation for promoting / shilling about an ICO or crypto project or will SEC press for more serious charges?

We will have to wait and see.

IMPORTANT DISCLAIMER

This material has been prepared for general informational purposes only and it is not intended to be relied upon as accounting, tax, investment, legal or other professional advice. Please consult with a professional for specific advice.

About the author

RK Reddy holds two Masters degrees, one in Accounting and another in Business Administration with over 15 years of experience in the financial services industry.

RK Reddy is an ardent fan of Blockchain and Cryptocurrencies. You can see the excitement about this new technology in every article on Cryptotapas.com. Sometimes this excitement leads to an overly optimistic view. Guilty as charged. RK Reddy says “what may seem like an ‘overly optimistic expectation’ today may become an everyday norm in 5-10 years; look at the history of cars or airplanes, Blockchain and Cryptocurrencies belong to the similar frame of reference.” Of course, that is just his opinion.

Buy us a coffee: Keep information FREE. We do not sell what we research. A small tip from you can help us bring you more content like this for FREE.

BTC: 37kJr9PodRHzsG5u1ZfKkfYpHFSZrS8s9n

Paypal: turiyallc@gmail.com

Please subscribe to the browser alert to be notified. No annoying emails, just in-browser reminders!





