Actor Steven Seagal has agreed to pay the Securities and Exchange Commission over US$330,000 for his role in promoting the Bitcoiin2Gen cryptocurrency.
Since mass media came into being, companies have used celebrities to promote their wares. The realm of cryptocurrency is no different. A number of crypto businesses have used some notable names to generate buzz and dollars. Some of the celebrities that have touted crypto projects include Paris Hilton, Ashton Kutcher, Floyd Mayweather Jr., and DJ Khaled. Another such celebrity is action movie actor Steven Seagal, who was named the brand ambassador for the Bitcoiin2Gen (B2G) cryptocurrency in February 2018. That association has now cost him dearly as he recently agreed to pay the U.S. Securities and Exchange Commission (SEC) just over $330,000 for his promotion of B2G.
Under Siege From the SEC
The reason why Seagal is paying the SEC is that he ran afoul of their anti-touting rule that says anybody who promotes a “virtual token or coin that is a security” must disclose the fact if they are being compensated for doing so. In fact, the promoter has to reveal the scope, nature, and total amount of compensation they are receiving.
When Seagal promoted Bitcoiin2Gen through his social media accounts, he failed to disclose he was going to be paid $250,000 in cash and another $750,000 in B2G tokens. When the B2G ICO went live in February 2018, Seagal promoted the endeavor “wholeheartedly.” However, the ICO launched six months after the SEC released its 2017 DAO Report that said coins sold in ICOs could be considered securities.
Kristina Littman, Chief of the SEC Enforcement Division’s Cyber Unit, notes:
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.
Steven Seagal Not Above the Law
The SEC charged Steven Seagal for violating their anti-touting provisions. The actor chose to settle with the federal agency without admitting or denying their charges.
Seagal has agreed to pay $157,000, which is the amount of money he actually received for promoting the B2G cryptocurrency. He also paid a $157,000 fine and $16,000 in interest. He has also agreed not to promote any securities for the next three years.
The Bitcoiin2Gen project has not lived up to its hype, such as promising miners two to three times the revenue of Bitcoin miners as well as having transaction fees ten times less than Bitcoin. The announcement of “Zen Master” Steven Seagal being named as brand ambassador for B2G made for some interesting reading.
The announcement stated:
As a Buddhist, Zen teacher, and healer, Steven lives by the principles that the development of the physical self is essential to protect the spiritual man. He believes that what he does in his life is about leading people into contemplation to wake them up and enlighten them in some manner. These are precisely the objectives of the Bitcoiin2Gen to empower the community by providing a decentralized P2P payment system with its own wallet, mining ecosystem and robust blockchain platform without the need of any third party.
B2G had hit a high of $0.72 when the project first launched in February 2018, but the coin is currently trading at $0.000348.
Images courtesy of Flickr/Gage Skidmore and YouTube/Movieclips Classic Trailers.
Source: https://bitcoinerx.com/cryptocurrency/steven-seagal-fined-330k-for-promoting-bitcoiin2gen/
