Ex-NBA star Paul Pierce settles with SEC over crypto breaches
Paul Pierce #34 of the Boston Celtics celebrates after a game against the Los Angeles Lakers in the fourth quarter during game five of the 2010 NBA Finals June 13, 2010 at TD Garden in Boston, Massachusetts.
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NBA Hall of Famer Paul Pierce, who won a championship with the Boston Celtics, has agreed to a $1.4 million settlement with the Securities and Exchange Commission over allegations that he unlawfully touted cryptocurrency securities, the regulator said on friday with
The lawsuit against Pierce involves his public statements about EthereumMax or EMAX, the same crypto security product that the SEC has accused influencer Kim Kardashian of illegally promoting.
Pierce promoted EthereumMax tokens on Twitter without disclosing that he was paid for his promotion with more than $244,000 worth of EMAX tokens, the SEC claimed. Pierce has not admitted or denied any wrongdoing as part of the settlement and will pay a $1.1 million fine and spend “approximately $240,000,” the SEC said.
Pierce is also barred from promoting crypto-asset securities for three years, the SEC said.
“This case is another reminder for celebrities: the law requires you to disclose to the public who pays you and how much to promote investment in securities, and you must not lie to investors when you promote a security.” , SEC Chairman Gary Gensler said in a statement.
Pierce’s social media endorsement of EthereumMax also included allegedly misleading the public about its EMAX holdings, according to the SEC. Pierce allegedly shared misleading screenshots of his EMAX holdings and earnings, the SEC said, without disclosing that his personal holdings were actually much lower.
“@espn I don’t need you,” Pierce wrote in a May 2021 tweet. “I have @ethereum_max. I’ve made more money from this crypto in the last month than you all made in a year.”
The SEC said that Pierce’s 2020 gross compensation from ESPN was more than $1 million.
Pierce officials did not immediately respond to a request for comment.
Kardashian settled with the SEC in October for $1.2 million over her alleged endorsement of EMAX, which included a now infamous line: “Are you guys in Crypto????”
A nationwide class-action lawsuit naming Pierce, Kardashian, Floyd Mayweather Jr., and other EthereumMax boosters was dismissed in December. A judge found that the plaintiffs’ allegations did not meet the “raised pleading standards” that fraud cases demand. The lawsuit was refiled that same month.
The SEC has become more aggressive with its enforcement actions in the crypto space. On Thursday, the regulator charged stablecoin issuer Terraform and CEO Do Kwon with fraud.
Earlier this week, the SEC proposed changes to the federal custodial code that could significantly impact the way cryptocurrency exchanges can custodian certain assets. Days earlier, crypto exchange Kraken settled with the SEC through its staking service. And in January, the SEC unveiled charges against crypto lender Genesis and crypto exchange Gemini for alleged unregistered offerings and sales of securities.
— CNBC’s Rebecca Picciotto contributed to this report.
REGARD: SEC Chairman Gensler breaks down allegations against Kim Kardashian