Published: Sun, December 02, 2018
Finance | By Loren Pratt

Mayweather, DJ Khaled settle SEC cryptocurrency charges

Mayweather, DJ Khaled settle SEC cryptocurrency charges

Two of its founders were arrested in April 2018 on securities-fraud charges.

The US Securities and Exchange Commission (SEC) has settled charges against DJ Khaled and Floyd Mayweather Jr for unlawful ICO promotion. Centra Tech paid Mayweather $100,000 and Khaled $50,000, the agency said.

Music producer DJ Khaled was also paid to promote Centra and was charged by the SEC on Thursday as well. Mayweather also agreed to continue to co-operate with the investigation. An attorney for DJ Khaled declined to comment, The Wall Street Journal reported.

According to the CNBC, the two celebrities have agreed to a payment deal with Floyd Mayweather the famous boxing champion agreeing to pay over $600,000 in penalties and disgorgement plus 14,775 in interests.

Floyd Mayweather and DJ Khaled have been fined by the U.S. securities regulator for the unlawful promotion of ICOs.

Mayweather's promotional work for Centra included a message to his nearly 8 million Twitter followers that said that the ICO "starts in a few hours".

Per data gathered by the SEC, Mayweather was paid $100,000 for a series of Centra posts and $200,000 for other ICOs, while Khaled saw a $50,000 check fly his way from Centra alone.


For that money, Centra got Mayweather Tweeting on September 18, 2017, "Centra's ICO starts in a few hours".

"These cases highlight the importance of full disclosure to investors", said Stephanie Avakian of the SEC's Enforcement Division.

One of the strangest episodes in last year's massive cryptocurrency boom was when boxer Floyd Mayweather posted an Instagram endorsement for a little-known cryptocurrency called Centra.

In addition to imposing fines, the SEC settlements bar both men from being paid to promote or publicise any securities offering for at least two years.

Initial coin offerings, a form of capital raising often used by cryptocurrency start-ups, have come under heavy scrutiny from regulators including the SEC and the Australian Securities and Investments Commission. To avoid conflicting with authorities, SEC advises celebrities to know what they are endorsing and always disclose relevant facts to the public.

Mayweather told his followers to "Get yours before they sell out" while Khaled touted a "game changer" when promoting an initial coin offering (ICO) from Centra Tech.

Do you think this action by the SEC will put an end to celebrity ICO endorsements?

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