Charges against Lindsay Lohan and Jake Paul for pushing cryptocurrency

On Wednesday, the United States Securities and Exchange Commission (SEC) announced that it has charged Chinese entrepreneur Justin Sun with fraudulently promoting the cryptocurrencies Tronix (TRX) and BitTorrent (BTT) and concealing payments made to celebrities to promote these tokens. Sun owns Tron Foundation, BitTorrent Foundation, and Rainberry, and allegedly directed employees to conduct hundreds of thousands of simultaneous or near-simultaneous purchases and sales of TRX and BTT without any real change in ownership, creating the appearance of legitimate trading to sell TRX while keeping prices stable, and generating tens of millions of dollars of illegal profit at the expense of investors. Actress Lindsay Lohan, YouTube influencer Jake Paul, rapper Akon, recording artists Ne-Yo and Lil Yachty, and adult actress Michele Mason were among the celebrities who promoted these crypto investments to their millions of followers without disclosing that they had been paid. The six agreed to pay over $400,000 in disgorgement, interest, and penalties to settle the claims, but two others named in the SEC’s complaint, rapper Soulja Boy and pop singer Austin Mahone, did not reach a settlement with the SEC. The SEC issues civil penalties such as fines and does not press criminal charges. The US regulators have increased oversight of cryptocurrencies following the collapse of FTX and the arrest of its founder, Sam Bankman-Fried, on fraud charges last year.

Recommended Further Readings