The U.S. Securities and Exchange Commission announced that it entered into a settlement agreement with music producer DJ Khaled (known best for his hit “All I Do is Win”) and boxer Floyd Mayweather (known best for his hits) based on their failure to disclose payments to promote an Initial Coin Offering.
The SEC accused Khaled of accepting $50,000 to promote an ICO offered by Centra Tech Inc. and Mayweather accepting promotional payments from three ICO issuers, including $100,000 from Centra Tech Inc. Khaled and Mayweather promoted the ICOs via social media, but did not disclose the payments they had received.
“These cases highlight the importance of full disclosure to investors,” said SEC Enforcement Division Co-Director Stephanie Avakian. “With no disclosure about the payments, Mayweather and Khaled’s ICO promotions may have appeared to be unbiased, rather than paid endorsements.”
Mayweather and Khaled did not admit to the SEC’s findings, but agreed to pay disgorgement, penalties and interest. Mayweather agreed to pay $300,000 in disgorgement, a $300,000 penalty, and $14,775 in prejudgment interest. Khaled agreed to pay $50,000 in disgorgement, a $100,000 penalty, and $2,725 in prejudgment interest. They also each agreed to not promote any securities for a period of time.
