• by Wendy Davis  @wendyndavis, October 3, 2022

Celebrity Kim Kardashian has agreed to pay $1.26 million for allegedly violating Securities and Exchange Commission rules by touting EthereumMax's crypto asset on Instagram, without disclosing the company's payment to her.

The agency said in an order issued Monday that Kardashian touted EthereumMax in a June 13, 2001 Instagram post for which she was paid $250,000.

“Are you guys into crypto?” the reality TV star asked in the post.

“This is not financial advice, but sharing what my friends just told me about the Ethereum Max token,” the post continued. “A few minutes ago, Ethereum Max burned 400 trillion tokens -- literally 50% of their admin wallet giving back to the entire e-max community.”

The post also linked to the EthereumMax website, which had instructions for purchasing tokens.

The bottom of the post included an “#AD” tag, the agency said.

The agency said Kardashian violated a provision of the Securities Act requiring endorsers to disclose that they received payment, as well as the amount received.

She did not admit or deny the agency's findings.

In addition to the monetary penalty, Kardashian promised to refrain from endorsing crypto security assets for three years.

“The federal securities laws are clear that any celebrity or other individual who promotes a crypto asset security must disclose the nature, source, and amount of compensation they received in exchange for the promotion," Gurbir S. Grewal, director of the agency's enforcement division, stated Monday. “Investors are entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information."

Kardashian, a prolific social media endorser, previously drew other regulators' attention for touting Duchesnay's morning sickness drug, Diclegis, on Instagram.

In that matter, the Food and Drug Administration told Duchesnay that Kardashian's Instagram post violated the agency's long-standing requirement that ads touting the benefit of drugs also disclose their risks and contraindications.

Kardashian then revised the post to detail the drug's contraindications and side effects, including that it can cause drowsiness.