The Securities and Exchange Commission (SEC) is suing Justin Sun, founder of Tron, the open source blockchain ecosystem, for alleged market manipulation.

Civil charges have also been brought against public figures, including actress Lindsay Lohan, singer Austin Mahone and rapper Soulja Boy, for their role in promoting Sun’s crypto assets TRX and BTT. These figures, among others, promoted the crypto assets through their social media channels.

In a court filing, the SEC claims that the Chinese entrepreneur engaged in the orchestration of the unregistered offer and sale, manipulative trading, and unlawful touting of crypto asset securities.

The SEC claims the promotions were “wash trading”, with the promotors awarded Sun’s crypto assets as a reward.

Despite the fact the celebrities were paid to promote TRX and BTT, their touts on social media did not disclose that they had been paid or the amounts of their payments, the SEC said.

It added: “Thus, the public was misled into believing that these celebrities had unbiased interest in TRX and BTT and were not merely paid spokespersons.”

The watchdog said that Sun “directed the manipulative wash trading of TRX to create the artificial appearance of legitimate investor interest and keep TRX’s price afloat.”

The SEC notes, however, that the celebrities who promoted Sun’s crypto assets — except for Mahone and Soulja Boy — settled the charges for their involvement at over $400,000 yet did not admit or deny the SEC’s conclusions.

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