Home / Forex News /Prosecutors Seek Restrictions On Former FTX CEO's Electronic Devices Following VPN Use For Football Streaming

Prosecutors Seek Restrictions On Former FTX CEO's Electronic Devices Following VPN Use For Football Streaming

17 Feb 2023

The U.S. Securities and Exchange Commission (SEC) has charged Basketball Hall of Famer Paul Pierce for touting EMAX tokens and making misleading comments about unregistered crypto securities. The former Boston Celtics small forward agreed to settle the charges and pay the SEC $1.409 million.

The U.S.’s top securities regulator has charged former Boston Celtics forward Paul Pierce for unlawfully touting the cryptocurrency project called Ethereummax and the token EMAX. The Securities and Exchange Commission’s charges against Pierce follow an onslaught of enforcement actions by U.S. regulators against staking services, earn programs, stablecoins, and Do Kwon’s Terra blockchain ecosystem. According to the SEC complaint, Pierce “failed to disclose that he was paid more than $244,000 worth of EMAX tokens to promote the tokens on Twitter.”

Pierce agreed to settle the charges with the SEC for $1.409 million in penalties, disgorgement, and interest. The complaint further asserts that in one tweet, Pierce shared a screenshot of profits that were much lower than his personal holdings. Another tweet shared the Ethereummax project’s website, which led to a portal to purchase EMAX tokens. Pierce is not the only celebrity whom the SEC has fined for unlawfully touting and misleading investors with the Ethereummax project and associated tokens.

In Oct. 2022, socialite Kim Kardashian was charged with unlawfully promoting the crypto asset EMAX. At the time, Kardashian also settled with the SEC for $1.26 million in penalties. In a statement concerning Pierce’s charges, SEC Chair Gary Gensler insisted the case is “yet another reminder to celebrities.” Gensler continued, “The law requires you to disclose to the public from whom and how much you are getting paid to promote investment in securities, and you can’t lie to investors when you tout a security.”

The regulator added:

When celebrities endorse investment opportunities, including crypto asset securities, investors should be careful to research if the investments are right for them, and they should know why celebrities are making those endorsements.

The SEC’s charges note that the Basketball Hall of Famer violated the anti-touting and antifraud provisions of federal securities laws. The basketball star settled with the SEC on a non-admit or deny basis and promised not to promote any crypto assets for three years. The SEC further reminded investors to watch Gensler’s video about not making investments “solely on the recommendations of a celebrity or influencer.”

What are your thoughts on the SEC’s recent enforcement actions against celebrities promoting crypto assets and the alleged need for full disclosure to the public? Share your thoughts in the comments section below.

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

Image Credits: Shutterstock, Pixabay, Wiki Commons

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The U.S. Securities and Exchange Commission (SEC) has charged Basketball Hall of Famer Paul Pierce for touting EMAX tokens and making misleading comments about unregistered crypto securities. The former Boston Celtics small forward agreed to settle the charges and pay the SEC $1.409 million.

The U.S.’s top securities regulator has charged former Boston Celtics forward Paul Pierce for unlawfully touting the cryptocurrency project called Ethereummax and the token EMAX. The Securities and Exchange Commission’s charges against Pierce follow an onslaught of enforcement actions by U.S. regulators against staking services, earn programs, stablecoins, and Do Kwon’s Terra blockchain ecosystem. According to the SEC complaint, Pierce “failed to disclose that he was paid more than $244,000 worth of EMAX tokens to promote the tokens on Twitter.”

Pierce agreed to settle the charges with the SEC for $1.409 million in penalties, disgorgement, and interest. The complaint further asserts that in one tweet, Pierce shared a screenshot of profits that were much lower than his personal holdings. Another tweet shared the Ethereummax project’s website, which led to a portal to purchase EMAX tokens. Pierce is not the only celebrity whom the SEC has fined for unlawfully touting and misleading investors with the Ethereummax project and associated tokens.

In Oct. 2022, socialite Kim Kardashian was charged with unlawfully promoting the crypto asset EMAX. At the time, Kardashian also settled with the SEC for $1.26 million in penalties. In a statement concerning Pierce’s charges, SEC Chair Gary Gensler insisted the case is “yet another reminder to celebrities.” Gensler continued, “The law requires you to disclose to the public from whom and how much you are getting paid to promote investment in securities, and you can’t lie to investors when you tout a security.”

The regulator added:

When celebrities endorse investment opportunities, including crypto asset securities, investors should be careful to research if the investments are right for them, and they should know why celebrities are making those endorsements.

The SEC’s charges note that the Basketball Hall of Famer violated the anti-touting and antifraud provisions of federal securities laws. The basketball star settled with the SEC on a non-admit or deny basis and promised not to promote any crypto assets for three years. The SEC further reminded investors to watch Gensler’s video about not making investments “solely on the recommendations of a celebrity or influencer.”

What are your thoughts on the SEC’s recent enforcement actions against celebrities promoting crypto assets and the alleged need for full disclosure to the public? Share your thoughts in the comments section below.

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Oman to Incorporate Real Estate Tokenization in Virtual Assets Regulatory Framework

Real estate tokenization is set to be incorporated into Oman Capital Markets Authority (OCMA)'s virtual asset regulatory framework. According to an advisor with the authority, the tokenizing of real estate will open investment opportunities for local and foreign investors. Real ... read more.

Prosecutors in the financial fraud case against former FTX CEO Sam Bankman-Fried (SBF) are attempting to persuade the judge to restrict his use of electronic devices. It has been revealed that SBF used a virtual private network (VPN) to watch the Super Bowl through a foreign subscription service he had purchased before his arrest. Prosecutors, however, are skeptical and argue that VPNs are commonly used to access international crypto exchanges that are blocked in the United States.

Judge Lewis Kaplan is considering whether disgraced FTX co-founder Sam Bankman-Fried (SBF) should be allowed to use electronic devices and the internet. “There is a solution, but it’s not one anybody has proposed yet,” Kaplan told the court. The judge is considering changing SBF’s bail conditions because prosecutors have complained about his use of a VPN. Damian Williams, U.S. Attorney for the Department of Justice (DOJ), said the government learned that SBF used a VPN to access the web on Jan. 29 and Feb. 12, 2023.

Williams noted that VPNs have legitimate purposes, but the complaint also asserts that VPNs are commonly used to access international crypto exchanges. “Some individuals use VPNs to conceal the fact that they are accessing international cryptocurrency exchanges that use IPs to block U.S. users,” the government’s complaint stressed. However, SBF’s lawyer, Mark Cohen, who represented Ghislaine Maxwell during her sex trafficking trial, said SBF used the VPN to watch football.

“Our client used the VPN to access an NFL Game Pass international subscription that he had previously purchased when he resided in the Bahamas, so that he could watch NFL playoff games,” SBF’s lawyers Christian Everdell and Mark Cohen explained to the judge. “On January 29, 2023, he watched the AFC and NFC Championship games and on February 12, he watched the Super Bowl. This use of a VPN does not implicate any of the concerns raised by the government in its letter.”

Prosecutors have already complained that SBF was attempting to communicate with former Alameda Research and FTX staff members. The court has prohibited SBF from using end-to-end encrypted messaging services like Signal. Everdell and Cohen have stated that SBF will not use a VPN during this time until the defense team is ready to adopt a reasonable bail condition that allays any concerns the government or court may have regarding the use of a VPN.

What do you think about the use of VPNs in financial fraud cases? Should restrictions be placed on their use during bail? Share your thoughts in the comments.

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

Image Credits: Shutterstock, Pixabay, Wiki Commons

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