Prominent music producer, DJ Khaled, and boxer Floyd Mayweather were charged by the Securities and Exchange commissions [SEC] after they failed to disclose the fees they received for the promotion of initial coin offerings [ICOs]. According to a report released by SEC, Khaled and Mayweather received $50,000 and $100,000, respectively from Centra Tech for promoting their ICOs.
The DJ and the pro boxer took to their social media accounts to inform their followers about the ICO where Khaled called Centra a “game changer”.
Mayweather also tweeted about the same, saying “you can call me Floyd Crypto Mayweather from now on”.
In a statement, SEC stated:
“Without admitting or denying the findings, Mayweather and Khaled agreed to pay disgorgement, penalties, and interest. Mayweather agreed to pay $300,000 in disgorgement, a $300,000 penalty, and $14,775 in prejudgment interest. Khaled agreed to pay $50,000 in disgorgement, a $100,000 penalty, and $2,725 in prejudgment interest.”
The SEC has been on its toes to crack down on ICOs, which has escalated through a sudden investment to one of the agencies top enforcement policies. The ICOs include the sale of digital tokens in relation to blockchain projects. After tracking them down, some of those projects were near completion, while many turned out to be mere scams.
The SEC had announced that it had opened dozens of investigations into fraudulent ICOs and other cryptocurrency assets. The SEC had also stated that it reached settlements with two companies selling tokens in ICOs, which had generated a sum of $27 million from the ICOs a few weeks back.
However, the founder of the company, who paid the DJ and the footballer, was also charged by SEC with fraud in April. It stated that the $32 million that the ICO had raised with the help of the Khaled and Mayweather was “a sophisticated marketing campaign to spin a web of lies about their supposed partnerships with legitimate businesses”.
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