The U.S. Securities and Exchange Commission (SEC) has announced that it reached a settlement with long-time action movie star Steven Seagal in charges related to his promotion of the Bitcoin2Gen (B2G) initial coin offering.
According to the SEC, Seagal has failed to disclose that he was being paid for his promotional activity, in violation of the anti-touting provisions of U.S. securities laws. Those provisions require celebrities to disclose to investors any compensation they receive for their promotion of any virtual token or coin that might be a security.
In Seagal’s case, he had allegedly promoted the B2G ICO through posts on his social media and in a press release naming him as Bitcoin2Gen’s ‘Brand Ambassador.’ Seagal had reportedly been promised $750,000 in B2G tokens and $250,000 cash in exchange for his promotional activities. The compensation was apparently never disclosed to potential investor. SEC Enforcement Division Cyber Unit chief Kristina Littman explained why that matters:
"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."
As part of the settlement, Seagal has agreed to pay the SEC the $157,000 he received for his promotion, prejudgment interest, and another $157,000 in penalties. He was not required to deny or admit the allegations. In addition, Seagal will be prevented from any similar promotions for a period of three years.