Jake Paul, 5 others settle with SEC for $400,000 after being hit with crypto violations
Tronix founder Justin Sun was charged with fraud
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Jake Paul and five other celebrities settled for a combined $400,000 with the SEC after being hit with crypto violations.
The violations stem from the SEC charging Tronix founder Justin Sun with fraud and unregistered securities charges.
The SEC alleged that Sun manipulated the trading activity of both Tronix and BitTorrent.
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Jake Paul answers questions from the media during a press conference at Madison Square Garden on July 12, 2022 in New York City. (Mike Stobe/Getty Images / Getty Images)
Sun allegedly induced investors to purchase to crypto tokens by "orchestrating a promotional campaign in which he and his celebrity promoters hid the fact that the celebrities were paid for their tweet," SEC chair Gary Gensler said in a statement.
"Sun and his companies not only targeted U.S. investors in their unregistered offers and sales, generating millions in illegal proceeds at the expense of investors, but they also coordinated wash trading on an unregistered trading platform to create the misleading appearance of active trading in TRX," Gensler also said.
Jake Paul exits the ring after his unanimous decision win over Anderson Silva of Brazil in their cruiserweight bout at Desert Diamond Arena on October 29, 2022 in Glendale, Arizona. (Christian Petersen/Getty Images / Getty Images)
"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."
Actress Lindsay Lohan, musicians Soulja Boy, Ne-Yo, Akon, Austin Mahone, Lil Yachty and adult actress Kendra Lust are the other celebrities listed in the suit.
Soujla Boy and Mahome are the only two celebrities that were not included in the settlement, which was not an admission of guilt.
Jake Paul takes the ring for his cruiserweight bout against Anderson Silva of Brazil at Gila River Arena on October 29, 2022 in Glendale, Arizona. (Christian Petersen/Getty Images / Getty Images)
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Paul is coming off a loss to Tommy Fury in February.