Rapper and producer DJ Khaled and boxer Floyd Mayweather were each charged by the US Securities and Exchange Commission for not telling investors that they had been paid to promote an Initial Coin Offering (ICO) for cryptocurrency startup Centra.
These are the first charges filed for promoting ICOs, a new method of attracting billions of investor dollars to often unvetted cryptocurrencies.
Khaled did not disclose a $50,000 payment from Centra Tech for promoting its cryptocurrency launch. Mayweather was paid $100,000. for the same promotion. Khaled called Centra a "game changer" on social media, without disclosing that he was a paid spokesperson, according to the SEC.
Mayweather also did not disclose $200,000 he was paid to promote two other ICOs.
Their punishment according to CNBC:
"Mayweather will pay $300,000 in disgorgement, a $300,000 penalty and $14,775 in interest. Khaled will pay $50,000 in disgorgement, a $100,000 penalty and $2,725 in interest. Mayweather also agreed not to promote securities for three years and to cooperate with the investigation and Khaled agreed to a two year ban."