The US Securities and Exchange Commission (SEC) accuses actor Steven Seagal of illegally promoting a cryptocurrency investment scheme that claims to be “the next generation of bitcoin.” Seagal failed to reveal that it was compensated in cash and crypto by Bitcoiin2gen, or B2G, for marketing its token offerings, such as on Twitter and Facebook.
SEC Fees Increase Seagal Stevel for Crypto Unlawful Promotion
The SEC announced on Thursday that it had settled demands against Hollywood actor and producer Steven Seagal over the promotion of cryptocurrency investment products. The SEC explained that Seagal was “touting the security of media offered and sold on coin offers (ICO) on social media without disclosing that the issuer paid for the promotion.” This offer was made by Bitcoiin2gen, also known as B2G. Noting that the actor violated the Securities Act, the Commission explained:
Seagal failed to disclose he was promised $250,000 in cash and $750,000 worth of B2G tokens in exchange for his promotions, which included posts on his public social media accounts encouraging the public not to ‘miss out’ on Bitcoiin2gen’s ICO and a press release titled ‘Zen Master Steven Seagal Has Become the Brand Ambassador of Bitcoiin2gen
“The SEC order found that Seagal violated the anti-touting provisions of federal securities laws. Without acknowledging or rejecting the SEC's findings, Seagal agreed to pay a relief of $ 157,000, representing actual promotional payments, plus prejudiced interest, and a $ 157,000 fine. In addition, Seagal agreed not to promote securities, digital or other, for three years, “the agent explained.
Steven Seagal for ‘The Next Generation of Bitcoin'
Steven Seagal earned his net worth as a big action movie star in the 1980s and 90s. He appeared in more than 50 films, including Above the Law, Hard to Kill, Out for Justice, Under Siege, and Out of Reach. Seagal's net worth is now $ 16 million, according to celebritynetworth.com. 67 years old currently lives in Moscow, Russia. President Vladimir Putin gave him a Russian passport in 2016.
According to SEC orders, from around 12 February to 6 March 2018, Seagal was touting opportunities for B2G cryptocurrency investment in its Twitter and Facebook accounts. At that time, he had around 107,000 followers on Twitter and 6.7 million on Facebook. While he is not running an ICO, Seagal allows his photos to be used on the official Bitcoiin2gen website and marketing material. He also received payment for participating in webinars with potential investments.
Bitcoiin2gen described its B2G token as “the next generation of bitcoin,” the SEC wrote. Its marketing material says “Bitcoiin – 2nd Generation. Bigger and better than the original.” The company claims that the funds raised will be used to “build an” ecosystem “that will allow users to trade B2G tokens, make wallet bets, and trade altcoin and currency fiat money, all ‘on a secure, comprehensive platform,' “the SEC explained, noting:
Participants in the ICO invested bitcoin, U.S. dollars, euros, or made payments via credit card in exchange for B2G tokens.
The SEC further pointed out that the Bitcoiin2gen press release included a quote from Seagal stating that he supported the token offer “with all my heart.” Noting that this promotion was carried out six months after its DAO Report warned that cryptocurrency sold at ICO might be an effect, the SEC stressed that “in accordance with anti-touting provisions of federal securities laws, celebrities or other individuals promoting virtual tokens or coins that constitute securities must disclose the nature, scope and amount of compensation received in return for promotion. “Kristina Littman, Head of the SEC's Cyber Enforcement Unit, explains:
These investors have the right to know about the payments Seagal has received or promised to support this investment so they can decide whether he might be biased. Celebrities are not permitted to use their social media influence to peek at securities without expressing their compensation appropriately.
