Floyd Mayweather Jr., DJ Khaled to pay big penalties in cryptocurrency promotions

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By Alex Johnson

The five-time world boxing champion Floyd Mayweather Jr. and the versatile music producer and executive DJ Khaled have agreed to pay hefty penalties for failing to disclose money they were paid to promote investments in cryptocurrencies, regulators said Thursday.

The Securities and Exchange Commission, or SEC, said the charges were the first it has ever brought involving what are known as initial coin offerings, or ICOs.

Mayweather, 41, the undefeated winner of world titles in five weight classes, and Khaled, 43, whose real name is Khaled Mohamed Khaled, were legally required but failed to disclose payments from issuers of ICOs to promote their offerings after the SEC warned last year that coins sold in ICOs may be securities subject to federal securities law, the SEC said.

Floyd Mayweather Jr., left, and DJ Khaled.Jamie McCarthy / Rizin Fighting Federation, Getty Images

Neither man admitted or denied guilt, but both agreed to pay six-figure penalties, the agency said.

Mayweather agreed to pay $300,000 in restitution, $300,000 in penalties and $14,775 in interest, while Khaled agreed to pay $50,000 in restitution, $100,000 in penalties and $2,725 in interest.

Mayweather and Khaled also agreed not to promote any securities, digital or otherwise, for three years, and two years, respectively, while Mayweather agreed to cooperate with the SEC’s investigation of alleged ICO fraud.

The main ICO issuer in both cases was Centra Tech Inc. of Miami, whose founders were indicted in May by a federal grand jury in New York City on charges of having solicited investors to buy unregulated securities. The two other issuers weren’t identified.

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