Former Goldman Sachs executive arrested for alleged crypto casino fraud

The former director of Wall Street, Richard Kim, was arrested and accused of wire fraud and securities fraud to have allegedly diverted more than $ 4 million from investors in an online casino startup based on blockchain called Zeroedge.

According to a sworn affidavit laid By FBI’s special agent, Thomas McGuire, in the South New York district, Kim, which previously was CO of world exchange markets and emerging markets at Goldman Sachs and JP Morgan, launched Zero Edge in March 2024.

He marketed the company as a casino propelled by Crypto which would have chain games, a virtual currency called “Faith” and a negotiable token nicknamed “$ RNG”.

From March to June 2024, Kim collected around $ 4.3 million thanks to a round of financing of seeds and token sales, by launching investors on a development roadmap which included intelligent contracts, casino game mechanisms and compliance with game regulations and securities.

Finder the diversion

However, prosecutors allege that Kim has distorted the use of investor funds and has diverted money for unauthorized purposes, including speculative cryptocurrency trades.

The FBI survey revealed that Kim had promised in official agreements and tokens’ sales documents that the funds would exclusively go to the construction of the platform.

At least one investor told authorities that they would not have invested if they had known that the funds were actually personal loans to Kim.

Kim also cited the legal examinations of companies like Greenberg Traurig to reassure investors of regulatory compliance.

But according to the complaint, certain key agreements have never been fully executed or have been modified to remove obligations concerning financial transparency and internal controls.

Kim faces charges under title 18 for wire fraud and securities fraud under federal securities. The case remains under investigation.