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ARTICLE · 06 OCTOBER 2022

SEC Fines Kim Kardashian For Promoting Digital Asset On Instagram

Winston Taylor
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On October 3, 2022, the Securities and Exchange Commission (SEC) issued a cease-and-desist order (the "Order") against media personality Kim Kardashian for violations...

United StatesTechnology
Kimberly A. Prior
Kimberly A. Prior
Carl Fornaris
Carl Fornaris
Daniel T. Stabile
Daniel T. Stabile

On October 3, 2022, the Securities and Exchange Commission (SEC) issued a cease-and-desist order (the "Order") against media personality Kim Kardashian for violations of Section 17(b) of the Securities Act of 1933 (the "Securities Act"), which makes it unlawful for any person to promote a "security" without fully disclosing the receipt and amount of compensation received for such promotion. Section 17(b) is known as the SEC's "anti-touting rule."

The SEC's charges stemmed from an Instagram story posted by Kardashian on June 13, 2021, about EMAX tokens, a digital asset offered by EthereumMax. The post included a link to the EthereumMax website, through which potential investors could purchase EMAX tokens. Although Kardashian's Instagram post included "#AD" in a series of hashtags at the end of the post, the hashtag was not sufficient to comply with the requirements of Section 17(b) because Kardashian did not specifically mention that she was paid $250,000 for

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