Category Archives: DJ Khaled

Auto Added by WPeMatico

SEC Cracks Down on ICO Promoters, Social Media Influencers


ICO promoters and other social media influencers will now be targeted by the US Securities and Exchange Commission (SEC). The SEC is not known to be friendly towards ICOs and has a number of cases against token launches.

The recent settlement with music mogul DJ Khaled and professional boxer Floyd Mayweather are examples of SEC coming down hard on people who promote ICOs without informing the regulator about the compensation received. This had been warned by SEC a year back when it said, “Any celebrity or other individual who promotes a virtual token or coin that is a security must disclose the nature, scope, and amount of compensation received in exchange for the promotion.”

In November, it again emphasized the role of promoters in ICOs, this time turning towards investors: “Investors should be skeptical of investment advice posted to social media platforms, and should not make decisions based on celebrity endorsements. Social media influencers are often paid promoters, not investment professionals, and the securities they’re touting, regardless of whether they are issued using traditional certificates or on the blockchain, could be frauds.”

The move is definitely going to affect ICO promotions in the United States. With most ICOs declared securities under its regulations, SEC chairman Jay Clayton said, “Many of the ICOs that you see and you talk about, they are securities. And if you’re going to offer or sell securities, you have to do so in compliance with our laws.”

Coinbase, for example, has been working very closely with the US regulators and even with its wish to add five tokens to its listing, has only been able to do only two in the last seven months. Listing of an unauthorized token that is a security can lead to indictment for illegally distributing unregistered securities.

The penalties are heavy, with fines being double to that of money received. Mayweather was fined USD 600,000 for promoting three different ICOs in return for USD 300,000.


Follow on Twitter: @bitcoinnewscom

Telegram Alerts from

Want to advertise or get published on – View our Media Kit PDF here.

Image Courtesy:

The post SEC Cracks Down on ICO Promoters, Social Media Influencers appeared first on

Mayweather-Endorsed ICO Founders Charged with Fraud

The US Securities and Exchanges Commission(SEC) has charged Centra Tech co-founders, Sohrab Sharma and Robert Farkas, with fraud. Farkas was arrested over the weekend attempting to flee the US.

Their coin offering has been suspended after raising USD 32 million selling “unregistered securities”. The charge has been made by the SEC against Sharma and Farkas of “orchestrating a fraudulent coin offering”.

The SEC made a statement reporting that both Sharma and Farkas had no relationship with Visa, Bancorp, and Mastercard after claiming that they would be developing financial products backed by both credit card companies.  Cease and desist letters were issued by the above companies.

It is alleged that Sharma and Farkas sought out and paid celebrities to endorse the ICO, including boxer Floyd Mayweather and DJ Khaled. The agency also accuses the co-founders of creating fictitious executives and false marketing materials. Centra Tech claimed to have a Harvard MBA and banker Michael Edwards as a co-founder as CEO along with a Jessica Robinson as chief financial officer. Neither of these people actually existed.

A statement by the SEC alleges that “the defendants relied heavily on celebrity endorsements and social media to market their scheme”, going on to point out that “endorsements and glossy marketing are no substitute for the SEC’s registration and disclosure requirements”.

The SEC made it quite clear in January of this year that it wasn’t ready to ban coin offerings, but promised to chase down firms abusing the industry and selling unregistered assets, claiming “that its the bad behaviour of the people taking advantage of the technology we want to look at”.

This year the SEC hinted at cracking down on ICOs as it believes that many offerings are being conducted illegally.  SEC Chairman Jay Clayton suggested that “their promotors and other participants are not following our security laws. Some people say that’s because the law isn’t clear. I don’t buy that for a moment”.

Further regulation is still under discussion.


The post Mayweather-Endorsed ICO Founders Charged with Fraud appeared first on