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DJ Khaled and Boxer Floyd Mayweather Charged for Unlawfully Promoting ICO

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Boxer Floyd Mayweather and DJ Khaled have been charged for unlawfully advertising Initial Coin Offerings (ICOs), by the United States Securities and Exchange Commission(SEC) according to a press release on November 29th.

According to the announcement, the SEC investigated that Mayweather did not disclose his promotional ICO payments from three issuers which include $100,000 from cryptocurrency startup Centra tech, while musician DJ Khaled had also failed to disclose $50,000 from the same company.

According to the announcement, the SEC investigated that Mayweather did not disclose his promotional ICO payments from three issuers which include $100,000 from cryptocurrency startup Centra tech, while musician DJ Khaled had also failed to disclose $50,000 from the same company.

In may this year, three co-founders of Centra, Sohrab Sharma, Robert Farkas, and Raymond Trapani were also accused of a fraudulent ICO, where they raised $32 million from investors in 2017.
Both Mayweather and Khaled neither accepted nor denied the charges against them but they agreed to pay certain fees and comply with the restrictions imposed on them. Mayweather has been asked to pay $300,000 in disgorgement, a $300,000 penalty, and $14,775 in prejudgment interest. While Khaled will pay $50,000 in disgorgement, a $100,000 penalty, and $2,725 in prejudgment interest.

Mayweather also agreed to help the SEC in their investigation and will not be promoting any kind of securities for the next three years. Khaled will not be promoting any security for the next two years.
Steven Peikin, SEC Enforcement Division Co-Director warned investors and told them to believe and investigate themselves before investing rather than be influenced by celebrity advertisements. He commented, "Investors should be skeptical of investment advice posted to social media platforms, and should not make decisions based on celebrity endorsements. Social media influencers are often paid promoters, not investment professionals, and the securities they're touting, regardless of whether they are issued using traditional certificates or on the blockchain, could be frauds."

Mayweather has been asked to pay $300,000 in disgorgement, a $300,000 penalty, and $14,775 in prejudgment interest. While Khaled will pay $50,000 in disgorgement, a $100,000 penalty, and $2,725 in prejudgment interest.

Mayweather started promoting Centra back in September 2017, saying that he was already using his Titanium Centra card to use digital currencies like Bitcoin (BTC) and Ethereum (ETH) in his business transactions.
Khaled also joined in later by making a public announcement of his acquisition of Titanium Centra card on his Instagram account.
In November 2017, SEC warned the investors that celebrity endorsed ICOs can still be illegal and investors must research before investing. The commission also claimed the celebrities would be violating the "anti-touting law" if they failed to reveal the compensation received from the endorsements.

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