Lindsay Lohan charged over cryptocurrrency scheme
Mean Girls actress Lindsay Lohan has been charged with failing to disclose that she was being paid to promote cryptocurrency tokens on social media.
According to the US Securities and Exchange Commission (SEC), which published a press release on the matter this week, Lohan wasn't the only celebrity involved, as YouTuber turned boxer Jake Paul, musicians Soulja Boy, Ne-Yo, Akon, Lil Yachty and Austin Mahone, as well as adult entertainer Michelle Mason, were also allegedly participating in this illegal scheme.
Lohan and Paul paid to settle the charges without admitting guilt – with the former having originally called for her massive Twitter following to invest in crypto asset securities Tronix [TRX] and BitTorrent [BTT] – paying $10,000 to the SEC and a further $30,000 in penalties as a result.
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"This case demonstrates again the high risk investors face when crypto asset securities are offered and sold without proper disclosure," shared SEC chairman Gary Gensler in a statement.
"[Crypto asset entrepreneur Justin] Sun further induced investors to purchase TRX and BTT by orchestrating a promotional campaign in which he and his celebrity promoters hid the fact that the celebrities were paid for their tweets."
Additionally, the SEC's division of enforcement director Gurbir S Grewal said: "While we're neutral about the technologies at issue, we're anything but neutral when it comes to investor protection. As alleged in the complaint, Sun and others used an age-old playbook to mislead and harm investors by first offering securities without complying with registration and disclosure requirements and then manipulating the market for those very securities.
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"At the same time, Sun paid celebrities with millions of social media followers to tout the unregistered offerings, while specifically directing that they not disclose their compensation. This is the very conduct that the federal securities laws were designed to protect against regardless of the labels Sun and others used."
Lohan and the other celebrities involved have not publicly commented on the charges, while Sun shared in a statement on social media: "We are eager to collaborate with governments and regulatory bodies globally that are dedicated to establishing transparent guidelines for regulating and working with the cryptocurrency industry given the important role it can play."
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