The US Securities and Exchange Commission (SEC) has sued actress Lindsay Lohan, YouTuber Jake Paul, and six other celebrities for promoting cryptocurrencies on social media without disclosing that they were being paid to do so. These charges as per AFP are part of a lawsuit against businessman Justin Sun. He is accused of manipulating cryptocurrency, trading on his platform Tron, a blockchain DAO ecosystem and marketing Tronix and BitTorrent assets without registering with the requisite authorities.
The US market regulator alleges that Sun tried to blow up Tronix by making it appear as though there was secondary market trading by making his own staff members purchase and sell the asset.
“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 in a statement.
Gesler alleged that Sun also used a campaign in which he and his celebrity promoters concealed the fact that they received payment for their tweets. These tweets were used to persuade investors to buy cryptocurrencies.
As per AFP, Lindsay Lohan and Jake Paul have agreed to pay $40,670 and $101,887 in restitution and fines, respectively. However, the two refrained from admitting or denying guilt.
Of the other six celebrities accused in the case, four, namely pornographic film actress Michele Mason alias Kendra Lust, rapper Lil Yachty, and singers Ne-Yo and Akon have also agreed to settle the lawsuit. However, the remaining two, Rapper Soulja Boy and YouTube singer Austin Mahone were not part of the settlement.
Since the spectacular collapse of market leader cryptocurrency exchange FTX at the end of last year, the enforcer of US financial market standards has been ramping up its attack on cryptocurrencies, and this case is just one of many.
(With inputs from agencies)
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