FROM OUR CEO: Did you see the news that Kim Kardashian recently landed in hot water with the SEC? The short version is that she promoted “EMAX tokens” from a company called EthereumMax. Starting with a short video promising a “major announcement” to her millions of followers, she then posted a series of Stories that started with the prompt, “Are you guys into crypto????” (You can view the screenshot here.)
Kardashian went on to claim that “friends” had told her about EthereumMax (sure, Jan), but managed to amend the whole promotion with a final #ad callout as the seventh and final hashtag on her Story.
This would technically be enough to appease the FTC, although the FTC’s own guidelines specifically require disclosures to be “easy to notice and read in the time that your followers have to look at the image.”
However, a tiny end-of-post #ad mention definitely isn’t enough for the SEC, and I believe there’s a big warning to smaller influencers here. It’s unlikely that an ‘everyday’ influencer would attract the same attention and incur the same six-figure fine, but we have certainly seen influencers get shut down by the platforms because of violations of terms and disclosure rules.
Creators should know that not every brand or agency is aware of the rules and how to adhere to them. If a sponsored campaign doesn’t include disclosure, both the brand AND influencer can be held responsible by the platforms and/or federal agencies such as the SEC and the FTC.
A couple days ago I saw a sponsored TikTok post from a brand who had clearly partnered with an influencer in an unofficial capacity. Not only was there no disclosure on the post, which could trigger an FTC fine (up to up to $43,792 per violation!), the promotion was for a type of product that is prohibited from doing branded content on TikTok.
The brand is clearly at risk here, but the person who created the TikTok could potentially lose her entire livelihood. She’s not a Kardashian-level influencer, but she has a large following and relies on sponsors for her monetized account.
Imagine getting permanently banned from your most lucrative platform because of a missing campaign disclosure.
When you work with Sway Group, you can be assured we take disclosure very seriously. We’re familiar with the requirements, and we have an entire QA team dedicated to checking content quality and FTC compliance before publication.
Don’t let bad influencer business practices tank your campaign. Talk to us today about setting up a kind of campaign that drives real audience connections — without relying on shady promotional tactics that can attract the wrong kind of attention.