The Securities and Exchange Commission (SEC) has consistently imposed fines besides issuing cease and desist orders as some of the strategies to suppress crypto influencers.
Influencers Involved in Crypto Scams and Price Manipulation Face Prosecution
The US SEC revamped its enforcement actions by pursuing crypto influencers using social media to promote scam projects and manipulate specific tokens’ prices. Via a Twitter post, John Reed Stark, the former agency’s chief, cautioned cryptocurrency influencers of likely prosecution.
According to the tweet, he focused on the social media influencers involved in several vague crypto projects and the manipulation of prices in the market. He cautioned that similar anti-fraud regulations would apply to fight against price manipulation in exchangem crypto and penny stock.
Weed Out Influencers Involved in Manipulating Crypto Prices
Stark expressed optimism that leveraging influencers to manipulate prices and offer crypto scam projects would end soon. Nonetheless, he urges regulators to heighten the fight against scams and deceptive price manipulation.
Stark highlighted the arrogant and bold manner most social media influencers used to extort victims. Social media platforms such as Instagram, Twitter, and Reddit are used for price manipulation.
Besides, he also claimed that owing to the state of securities fraud, detection and prosecution are easier than other fraud strategies that involve identity hiding by the perpetrator.
Stark explained that law enforcers and regulators could quickly discover an unusual and dazzling evidence trail by turning on their computers. Undoubtedly, social media is now the virtual rope most crypto partners use to hang themselves.
Revisiting Sabo and Kardashian Involvement in Scam Project and Price Manipulation
John Stark highlighted an instance involving Francis Sabo, a dishonorable crypto influencer, who was part of a fraud case amounting to 100 million dollars. Additionally, he manipulated exchange-traded stocks via the use of social media platforms.
Except for Sabo, several instances involving crypto influencers violating securities regulations have been reported. For instance, there is the well-known Kim Kardashian case, who promoted a scam project and was fined 1.26 million dollars.
Security Regulatory Agency Steps the War Against Deceptive Influencers
Bitboy Crypto is another famous influencer who has experienced significant backlash from the public due to shady projects. On 31st March, his name was mentioned in a 1-billion-dollar lawsuit for being involved in unregistered securities.
In November last year, several influencers received written orders from the Securities and Exchange Commission for being involved in the promotion of various tokens, including Pulsechain (PLS), Hex (HEX), and PulseX (PLSX).
Sportspersons Who Benefited From FTX Sponsorship Named Face Charges
Besides SEC going for influencers, aggrieved investors have filed lawsuits identifying sports and entertainment big names as defendants for deception to drive American consumers into investing in the collapsed FTX.
A notable lawsuit in Florida named the Golden State Warriors for its promotional input in rallying Americans to invest in the collapsed FTX empire. The submissions in the suit identify FTX’s logo as emblazoned on San Francisco’s Chase Center Court.
The lawsuit identified leading sportspersons and entertainment brands, including Kevin O’Leary, William Lawrence, and Udonis Haslem. Also mentioned are Spheren Curry, Naomi Osaka, and Shohei Ohtani. The plaintiff alleges that they controlled, promoted, and facilitated through active participation in the deceptive presentation of FTX business.
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