Floyd Mayweather has been fined heavily by the U.S Securities Exchanges Commission (SEC) for an “off the ring” activity. The pro boxer promoted an Initial Coin Offering (ICO) via his Twitter handle without telling his audience that the project owners were paying him a commission for the deal.
Music producer, DJ Khaled also faced similar charges from the SEC for taking time off the studio to promote an ICO via his social media handles.
According to a CNBC report, the flaunted ICO belongs to Centra Tech Inc. who paid Floyd Mayweather and Dj Khaled $100,000 and $50,000 respectively.
Floyd is alleged by the SEC to have tweeted to his over 7 million followers about Centra via his account with the message, “starts in a few hours. Get yours before they sell out, I got mine.” He also had collected $200,000 to promote two other unnamed ICOs and once tweeted, “You can call me Floyd Crypto Mayweather from now on.”
DJ Khaled on the other hand, described the Centra project as a game changer on his social media accounts, according to the SEC filing.
Both men did not deny the findings and have moved to settle the case which the SEC filed on the grounds that they failed to disclose their earnings to them. The SEC had earlier ruled that ICO tokens are “securities” and under this rule, Floyd Mayweather and Dj Khaled had served as brokers.
Besides this, Centra had earlier been charged by the SEC and Department of Justice for being a fraudulent ICO, so it can be said that somehow, the celebrities were promoting a fraudulent ICO to their followers.
Heavy ICO Penalties For Floyd Mayweather and Dj Khaled
As per the report, Mayweather will pay the SEC $300,000 in disgorgement, another $300,000 as a penalty and $14,775 in interest. For committing a lesser crime, Dj Khaled will pay the SEC $50,000 in disgorgement, another $100,000 as a penalty, and $2,725 as interest.
The men will also have to stay away from promoting securities with the SEC hitting them with three and two years ban respectively.
The total cash fines, in this case, will be $766,900 which may be considered a fixable debt for the celebrities to pay. Floyd and Dj Khaled have a net worth of nearly $1 billion.