Soccer star Cristiano Ronaldo has become the subject of a class-action lawsuit by plaintiffs who claim they suffered losses from his promotional campaign for Binance, a cryptocurrency exchange currently linked to legal trouble.
A lawsuit filed on November 27 in a US district court in Florida claims that Ronaldo “promoted, assisted and/or actively participated in the offer and sale of unregistered securities in coordination with Binance .”
Binance entered into a multi-year partnership with Ronaldo in mid-2022 to promote a series of its own non-fungible tokens (NFTs), with at least three of the soccer star’s collections tied to Binance.
The complaint alleges that users who signed up for Ronaldo NFTs are more likely to use Binance for other purposes, such as investing in what they claim are unregistered securities, including Binance’s BNB (BNB) and its harvest programs (harvest) in cryptocurrencies.
“Ronaldo’s promotions solicit or assist Binance in soliciting investments in unregistered securities by encouraging his millions of followers, fans and supporters to invest on the Binance platform.”
Ronaldo is a key part of Binance’s growing popularity due to his influence and reach, with 850 million social media followers, the complaint said. They claim that their NFT sale was “incredibly successful” in promoting the exchange, with a 500% increase in searches on Binance in the week after the first sale.
The lawsuit alleges that Ronaldo knew or should have known that “Binance was selling unregistered crypto securities,” because he had “investment experience and extensive resources to hire outside advisors.”
The suit cites US Securities and Exchange Commission (SEC) guidelines warning celebrities of the need to disclose payments received for promoting cryptocurrencies, something the suit says Ronaldo failed to do. .
The plaintiffs in the class action lawsuit are Michael Sizemore, Mikey Vongdara and Gordon Lewis, who are seeking damages and funds to cover legal expenses.
Meanwhile, Binance and its founder Changpeng “CZ” Zhao are facing their own legal troubles after pleading guilty and paying a $4.3 billion settlement to the US government for violating the anti-money laundering laws and management of an unregistered money transfer business.
Zhao resigned as CEO and faced 18 months in prison. Binance agreed that its compliance will be monitored by the US Department of Justice and the US Treasury Department for five years.
The SEC has also sued Binance, saying – among other charges – that it sold unregistered securities and is reportedly investigating whether Binance misappropriated customer funds.