Kim Kardashian, Floyd Mayweather Jr., and Paul Pierce are among several celebrities being prosecuted for allegedly leading investors into a cryptocurrency “pump and dump” scam.
According to a class-action complaint filed last Friday in the US District Court for the Central District of California, celebrities and other defendants were accused of “making false or misleading statements to investors about EthereumMax through social media advertisements and other promotional activities.” has been accused of. In addition to the three celebrities, the defendants include the company’s co-founders and others.
The lawsuit alleges that EthereumMax is “a speculative digital token created by a mysterious group of cryptocurrency developers.” It says celebrities asked their millions of social-media followers to buy cryptocurrencies, only to sell when the price went up.
According to the filing, Ryan Hughrich, a New York resident, filed a complaint on behalf of himself and others who purchased EMAX tokens between May 14, 2021 and June 27, 2021 and lost money.
Ethereummax denied the allegations. A spokesperson for the company said, “The misleading story surrounding the recent allegations is filled with misinformation.”
Ms Kardashian and representatives for Messrs Mayweather and Pierce did not immediately respond to requests for comment.
Mr Mayweather promoted EthereumMAX in 2021, when he was in a boxing match with YouTube celebrity Logan Paul. Former NBA player and sports commentator Paul Pierce promoted Ethereummax on his Twitter account during an unrelated conflict with ESPN at the time.
“.@espn i don’t need you. i got @ethereum_max i made more money with this crypto last month [sic] I’m done with you all in one year,” Mr Pierce tweeted.
Ms Kardashian promoted cryptocurrency on Instagram, where she has 278 million followers. A 2021 post by the reality TV star and entrepreneur asking his followers on the platform to join the “Ethereum Max community” drew criticism from the UK financial watchdog.
The head of the UK’s Financial Conduct Authority, Charles Randall, said in a speech in September that Ms Kardashian’s post “could be a financial hype with the largest audience reach in history.” He criticized the disclosure ad, saying that Ms Kardashian’s followers were not required to be told that EthereumMax was a month-old, speculative digital token.
“I cannot say whether this particular token is a scam,” Mr. Randall told the Cambridge International Symposium on Economic Crime, according to a copy of his remarks posted online. “But social media influencers are regularly paid by scammers to help them. Pump and dump new tokens behind pure speculation. Some influencers promote coins that don’t exist at all.”
An EthereumMax representative said at the time that Ms Kardashian’s “post was only intended to raise awareness of the project and its usefulness.”
This story has been published without modification to the text from a wire agency feed
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