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DJ Khaled accused of cryptocurrency fraud

DJ Khaled is many things for many people. Musician. Record producer. DJ. Social media maven. Fashion icon. Business magnate.

And now he can add "alleged cryptocurrency swindler" to his resume. The US Securities and Exchange Commission today announced that Miami's hip-hop star paid $ 152,725 in sanctions and settlements after accusing him of cryptocurrency crimes. The SEC said that Khaled (whose real name is Khaled Mohamed Khaled) did not disclose that he had been paid to promote the cryptocurrency "prime offers of coins" for various companies.

The SEC also hit boxer Floyd Mayweather for committing the same crime. (Mayweather paid $ 614,775 in penalties and settlements.) Both would have promoted a new Miami cryptocurrency company called Centra Tech without disclosing it, in fact, he paid them to talk about the brand on social media.

The SEC said that Khaled called Centra Tech a "game-changer", while Mayweather said that he wanted to rename "Floyd" Crypto & # 39; Mayweather "(his nickname is" Money ") and he told his followers that Centra Tech's "initial offering of coins" is a process by which the new Bitcoin-style cryptocurrencies sell their tokens, "it starts in a few hours." Get yours before they run out.

It turns out that Centra Tech has paid Khaled $ 50,000 and Mayweather $ 200,000. None of the celebrities told his followers about the money. (Neither admitted guilt as part of the SEC settlements).

In addition, Centra Tech seems to have been built on lies: The New York Times in 2017 he published a long exposition on Mayweather, Khaled and the company. The Times noted that Centra Tech seemed to have lied to the public repeatedly, including allegedly creating fake employees and lying about a commercial agreement with Visa and MasterCard credit card companies. Meanwhile, Centra Tech has raised $ 32 million. Two of its founders were arrested in April 2018 on allegations of securities fraud.

But there were indications, however, that the SEC was preparing to hit Khaled to promote cryptocurrency offers. Between the Bitcoin boom in November 2017, the SEC released a statement warning the public that celebrities have been paid a handful of money to promote a new currency offers and that many stars probably would not have revealed that they were accepting those funds to promote companies. The celebrities "who support an investment often do not have sufficient expertise to ensure that the investment is appropriate and in accordance with federal securities laws," wrote the SEC last year.

Khaled was also warned separately that he was not properly disclosing other cases in which he was paid to promote the products social media, including posts in which he boasted of his love for Cîroc vodka.

Khaled has now really played himself.

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