Lil Yachty,Soulja Boy, Akon and Ne-Yo were charged by the U.S. Securities and Exchange Commission for allegedly promoting a pair of cryptocurrencies without disclosing they were paid to do so.
According to Semafor, the aforementioned recording artists were among a sweeping SEC indictment on Wednesday (March 22) that included eight celebrities who promoted cryptocurrency tokens Tronix and BitTorrent.
Others involved in the alleged fraudulent crypto scam ran by entrepreneur Justin Sun were actor Lindsay Lohan, YouTuber/boxer Jake Paul, singer Austin Mahone and porn star Kendra Lust.
All celebrity parties outside of Big Draco and Mahone reportedly agreed to pay a fine that cumulatively added up to over $400,000 “without admitting or denying guilt” to settle the charges.
“Sun further induced investors to purchase TRX and BTT by orchestrating a promotional campaign in which he and his celebrity promoters hid the fact that the celebrities were paid for their tweets,” SEC Chairman Gary Gensler relayed in a statement.
While a spokesperson for Lohan added: “Lindsay was contacted in March 2022 and was unaware of the disclosure requirement. She agreed to pay a fine to resolve the matter.”
This isn’t the only cryptocurrency Soulja Boy and Lil Yachty were involved in as they were both named in a 60-page class-action lawsuit surrounding a scheme for SafeMoon in February 2022.
The “pump and dump” scheme was allegedly executed by SafeMoon founder Braden John Karony, who sought out celebrities to promote the token and artificially inflate its value throughout 2021 to maximize profits.
Several executives reportedly jumped ship by the end of 2021 when the token lost approximately 80 percent of its value after rising 875 percent throughout the year thanks to having celebrity backing.
They also reportedly didn’t deliver on any promises of expanding the SafeMoon brand with promises of a crypto wallet and more, which sounds like crypto’s version of Ja Rule’s failed Fyre Festival disaster.
Celebrity boxer Jake Paul, Backstreet Boys member Nick Carter and YouTuber Ben Phillips were also named for their role in the scheme.
T.I. and The Game are a couple of other artists to deal with cryptocurrency litigation in the past. Tip scored a legal victory in 2021 when a U.S. appellate court dismissed a lawsuit against him for exceeding the statute of limitations period regarding his ownership of the cryptocurrency FLiK in 2017.