Celtics legend Paul Pierce pays $1.5 million fine for promoting crypto without disclosing payment
Pierce was inducted into the Hall of Fame in 2021.
Basketball Hall of Famer Paul Pierce has reached a settlement after he touted EMAX tokens, crypto-asset securities offered and sold by EthereumMax, on social media without disclosing the payment he received for the promotion, the Securities and Exchange Commission said Friday.
“Pierce did not disclose that he was compensated by the entity offering and selling the security to provide crypto-asset security publicity,” the SEC order said.
Pierce also made false and misleading promotional statements, the SEC said.
Pierce, 45, agreed to settle the charges and pay $1.4 million in fines, disgorgement and interest.
“This case is another reminder to celebrities: The law requires you to disclose to the public from whom and how much you are paid to promote investment in securities, and you cannot lie to investors when you present a security,” said the SEC chief Gary Gensler. “When celebrities endorse investment opportunities, including securities in cryptoassets, investors should be careful to research whether the investments are right for them and they should know why celebrities are making these recommendations.”
Pierce failed to disclose that he was paid more than $244,000 in EMAX tokens to promote them on Twitter, according to the SEC’s order. Pierce also tweeted misleading statements related to EMAX, including a screenshot of an account showing large holdings and profits without disclosing that his own personal holdings were actually much lower than those in the screenshot.
“Despite the claim in this tweet that he has made more money with this crypto in the last month then [sic] [he] did with [ESPN] in a year[,]At the very least, Pierce was negligent in not knowing that this statement was materially misleading. Pierce, whose gross compensation from ESPN was over $1 million the previous year, only received the EMAX tokens two days before the post, the value of which was approximately $46,000 at the time he was paid, the SEC order said.
Pierce, who worked as a commentator, was let go by ESPN in 2021 after posting offensive photos from a poker game.
The shooting guard played 19 seasons in the NBA, including 15 with the Boston Celtics, where he won a title in 2008. He played in 10 All-Star Games and was inducted into the Naismith Memorial Basketball Hall of Fame in 2021.
He is just the latest in a string of prominent celebrities who end up paying huge fines for promoting crypto on social media without disclosing their personal interest in the brands. Kim Kardashian settled with the SEC for $1.26 million for promoting EMAX tokens in October 2022.
Disney is the parent company of both ESPN and ABC News.
