Direct-to-consumer real estate investment firm Fundrise has reached a settlement with the Securities and Exchange Commission after the agency claimed the company paid influencers to promote the platform without disclosing it was sponsored content.

Fundrise paid social media influencers $8M to solicit investors, the SEC said, but didn't make sure it was clear those influencers were paid, according to its charging order.

Federal law prevents firms from paying individuals to solicit clients without telling those clients they had been paid. According to the SEC’s order, Fundrise paid 200 social media influencers and online publishers to solicit clients for the platform without adhering to the appropriate disclosures and documentation required under the Cash Solicitation Rule.

The SEC introduced that rule in December 2020 as part of reforms aimed at modernizing the Investment Advisers Act of 1940.

In court documents, the SEC said Fundrise paid content creators based on the number of people who clicked on hyperlinks and entered their email addresses. Some of the people who clicked on the links and submitted their emails went on to do business with Fundrise.

The content creators that Fundrise engaged shared the company's content on their blogs, websites, newsletters and social media channels, but their audiences weren’t given a full understanding that they were being sponsored. The SEC said Fundrise willfully violated the rules but did consider, in reaching a settlement, the platform’s quick attempts to remediate the situation.

“We are pleased to have resolved this matter. Fundrise fully cooperated with the SEC staff in reaching this settlement, which addresses past conduct concerning the firm’s management of content creators," Fundrise Chief Financial Officer Alison Staloch, the former chief accountant of the division of investment management at the SEC, said in a statement.

“I have a deep appreciation for the importance of compliance in our industry. This settlement reinforces the significance of adhering to regulatory requirements and upholding the trust our clients place in us. Fundrise remains committed to the highest standards of compliance and integrity.”

Fundrise launched its first offering in 2012, and since then it has invested about $7B in real estate nationwide. The platform oversees about $3B in assets under management on behalf of more than 387,000 individual investors. In May, the platform said it was looking to raise a $500M credit fund aimed at providing a capital source to residential landlords who were struggling to find funding.

Fundrise was a pioneer in real estate crowdfunding, an industry that came under scrutiny in recent months when another popular firm, CrowdStreet, said that New York developer Nightingale Properties misappropriated tens of millions of investor dollars across two campaigns on its platform.

A Fundrise spokesperson said the firm is no longer a real estate crowdfunding platform.

CORRECTION, AUG. 29, 4 P.M. ET: A Fundrise spokesperson said the firm is no longer a real estate crowdfunding platform. This story has been updated.