February 28, 2020 | AtoZ Markets – Unlike the vigilantes he played in his movies, Steven Seagal is not above the law as the Securities and Exchange Commission has charged him for unlawfully participating in an initial coin offering (ICO). The popular Hollywood actor has ultimately agreed to pay over $350,000 for violating the anti-touting law.
US SEC fines Steven Seagal with illegal ICO promotion
The ICO bubble of 2017 and 2018 raised concerns among some world regulators, including the SEC. The U.S. watchdog warned back then that tokens sold as initial coin offerings (ICOs) may be securities. Ever since then, the Commission has been eagerly looking over on the matter, and Steven Seagal recently felt the impact.
A document disclosed Thursday informed that SEC settled charges with the American actor. During the bubble, he was promoting an ICO conducted by Bitcoiin2Gen (B2G). Seagal advertised the upcoming token on his public social media accounts. He also encouraged his fans not to “miss out” on the opportunity.
At the time, B2G even released a press release titled “Zen Master Steven Seagal Has Become the Brand Ambassador of Bitcoin2Gen.”
For using Seagal’s name and his promotional skills, B2G promised him $250,000 in cash and $750,000 worth of their native cryptocurrency, once they completed the sale.
The SEC, however, charged the actor for failing to disclose those payments. Ultimately, after two years, Seagal agreed to pay $157,000 in disgorgement. He will also pay a $157,000 penalty, plus an undisclosed amount of prejudgment interest. He has also agreed not to promote any more securities for three years.
The rules are different for celebrities
As per the Commission, the actor has violated the anti-touting provisions of the federal securities laws. It states that individuals, especially celebrities, have to disclose the nature, scope, and amount of compensation they have received for promoting a particular securities virtual token.
Speaking on the matter was Kristina Littman, Chief of SEC Enforcement Division’s Cyber Unit. She noted that celebrities could not simply take advantage of their social media popularity:
“These investors were entitled to know about payments Seagal received or was promised to endorse this investment so they could decide whether he may be biased. Celebrities are not allowed to use their social media influence to tout securities without appropriately disclosing their compensation.”
Should the SEC pursue heftier fines to illegal crypto ICOs? Let us know in the comments below.