U.S. SEC out for justice over Steven Seagal's cryptocurrency marketing

[February 28, 2020]    By Chris Prentice

WASHINGTON (Reuters) - Steven Seagal, the star of action movies including "Above the Law" and "Out for Justice," has agreed to pay $314,000 to resolve charges of "unlawfully touting" a cryptocurrency offering, the U.S. securities regulator said on Thursday.

Seagal, 67, agreed to give up $157,000 in ill-gotten gains and to pay another $157,000 as a penalty for failing to disclose payments he received for promoting an investment in an initial coin offering from Bitcoiin2Gen (B2G), the Securities and Exchange Commission said in a statement.

The SEC has moved to clamp down on such promotions. The agency said in 2017 that social media endorsements from celebrities to encourage people to buy stocks and other investments may be unlawful if they do not disclose details about compensation received.

Seagal, who did not admit to any wrongdoing, failed to disclose that he was promised $1 million in cash and B2G tokens in exchange for those endorsements, the SEC said.

Representatives for Seagal did not respond immediately to requests for comment.

Seagal, a Hollywood actor and martial arts expert who now lives in Russia, became a "believer" in and "brand ambassador" for the coins, B2G said in a statement in February 2018. From about February to March 2018, Seagal promoted B2G to his Facebook and Twitter followers with statements including "Don't miss out."

"These investors were entitled to know about payments Seagal received or was promised to endorse this investment, so they could decide whether he may be biased," said Kristina Littman, chief of the SEC Enforcement Division’s cyber unit.

As part of the deal, the actor has agreed not to promote any securities for three years.

Seagal is a U.S. national living in Moscow, the SEC said.

In August 2018, the Russia Foreign Ministry said it had named Seagal its special representative for Russian-U.S. humanitarian ties, a role it said was meant to deepen cultural, art and youth ties between the two countries.

President Vladimir Putin presented a Russian passport to Seagal in 2016, saying then that he hoped it would serve as a symbol of how fractious ties between Moscow and Washington were starting to improve.

(Reporting by Chris Prentice; Editing by Bernadette Baum and Jonathan Oatis)

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