Former SEC director John Reed Stark has warned influencers for manipulating cryptocurrency prices and they are being closely watched by the SEC.
The United States Securities and Exchange Commission (SEC) is closely monitoring crypto market influencers who were behind fraudulent projects and were found to be manipulating the prices of certain tokens. certain through social media.
Former SEC director John Reed Stark took to Twitter to warn crypto influencers to get ready to face prosecution.
In his tweet, John Reed Stark singled out crypto influencers on the social network who have worked on many crypto projects that are dubious and often help them manipulate the market price in the past. price increase.
He cautioned that for any form of price manipulation — be it the price of an exchange-listed security, penny stock or crypto securities — the same anti-fraud rules are in place. applied and numbered social media influencers.
The former SEC director argued that most shillings and price manipulation happen through social media platforms like Twitter, Discord, Instagram or Reddit. Stark notes that the nature of securities fraud makes it easier to detect and prosecute, unlike other forms of fraud where perpetrators often try to hide their identities.
Stark cited the examous crypto influencer Francis Sabo, who was charged in a $100 million stock fraud case and used social mediaple of notori platforms to manipulate the stocks traded on the exchange.
Aside from Sabo, there have been numerous cases where crypto influencers have been found to have violated securities laws. The most famous case is Kim Kardashian, who was fined $1.26 million for promoting a scam project.
Another major influencer facing the law is Bitboy Crypto, an influencer who has met with a lot of public outrage for promoting shady projects. On March 31, the YouTuber was named in a $1 billion lawsuit for advertising unregistered securities.
In November 2022, the SEC also issued multiple subpoenas to influencers for promoting Hex (HEX), Pulsechain (PLS) and PulseX (PLSX) tokens.