The Securities Exchange Commission has issued a warning to Nigerian celebrities and social media influencers who promote cryptocurrency platforms and assets without labelling their posts as sponsored.
The SEC has announced that a three-year jail term awaits culprits who support fraudulent crypto sites. This follows the numerous reported scams orchestrated by some of these cryptocurrency platforms being promoted by celebrities.
“Influencers who receive compensation to promote digital asset products or services shall disclose this arrangement to their followers. Failure to do so will result in a penalty of not less than 10 million, imprisonment for up to three years, or both,” stated the SEC directive.
The SEC believes that the misplaced trust individuals have in celebrities has led them to blindly invest in any content posted on social media without conducting additional research.
The commission has also mandated celebrities and influencers to do their due diligence in verifying that their crypto client is SEC-licensed and approved before promoting their content.
“Influencers shall before engaging in any promotional activities verify that both the VASP, products and services they intend to promote are licensed or approved by the commission,” stated the SEC guideline.
According to the SEC, officers have been employed to actively monitor online crypto promotions to ensure no violation of the directive. If caught, prosecution procedures will be initiated.
Source: www.mynigeria.com
