Several celebrities, including Kim Kardashian, boxer Floyd Mayweather Jr and former NBA All-Star Paul Pierce, are being charged for their role in an alleged cryptocurrency scam. These celebrities and the company EthereumMax, including co-founders and others, are being accused of making misleading statements about the company’s digital tokens, according to the California Central District class action lawsuit.
“The company’s executives, in conjunction with various celebrity promoters, have made (a) false or misleading statements to investors about EthereumMax through social media advertisements and other promotional activities and (b) their control over EthereumMax and a significant percentage of the EMAX tokens that became available for public trading during the Relevant Period,” the complaint reads.
EthereumMax provides ERC-20 virtual tokens on the Ethereum network. ERC-20 was trading at $0.0000001961 Tuesday morning, according to CoinMarketCap. The lawsuit alleged that the celebrities had told their million social media followers to buy the coins, only to sell when the price was high.
Last June, Kim Kardashian posted about EthereumMax token to her more than 250 million followers on Instagram. “Do you like crypto? This is not financial advice, but I am sharing what my friends just told me about the Ethereum Max token! A few minutes ago, Ethereum Max burned 400 trillion tokens — literally 50 percent of their admin wallet which is returned to the entire E-Max community,” she wrote.
On June 7, 2021, boxing legend Floyd Mayweather Jr. after a fight with Logan Paul to the press that he made $30 million sponsoring his shorts. “Just my bags, just my bags alone, $30 million. Just with the patches on my bags, that’s $30 million,” Mayweather said. The patches on Mayweather’s shorts include logos of the cryptocurrency EthereumMax.
“.@espn I don’t need you. I have @ethereum_max. I have made more money with this crypto in the past month than with you guys in a year. TRUTH will set you Free my own Boss http://EthereumMax.org check it out for yourself,” Pierce posted this past May from his Twitter account.
Ryan Huegerich filed the complaint on behalf of himself and others who purchased EMAX tokens between May 14, 2021 and June 27, 2021 and lost money, according to the filing. However, he did not mention how much money he lost during that time.
“Defendants’ inappropriate promotional activities generated the trading volume it took for all Defendants to transfer their EMAX Tokens to unsuspecting investors. While the plaintiff and class members purchased the inappropriately promoted EMAX Tokens, Defendants were able to, and did sell, their EMAX Tokens during the relevant time period for significant profits,” the complaint reads.
To the alleged cryptocurrency scam, an EthereumMax spokesperson replied, “The misleading narrative associated with the recent allegations is full of misinformation.” Kardashian, Mayweather and Pierce did not immediately respond to requests for comment, according to several media reports.
Crypto bubble?
Immediately after Kim Kardashian’s post on EthereumMax on EthereumMax, Charles Randell, chairman of the FCA, called the cryptocurrency “a speculative digital token created a month earlier by unknown developers”. He spoke at the Cambridge International Symposium on Economic Crime. He also accused influencers of the “delusions of quick riches”. “I can’t say if this particular token [Ethereum Max] is a scam. But social media influencers are routinely paid by scammers to help them pump and dump new tokens based on pure speculation. Some influencers are promoting coins that just don’t seem to exist at all,” he said.
Cryptocurrency markets are extremely volatile.
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