A former New Jersey State corrections officer has been accused by the Securities and Exchange Commission (SEC) of running two fraudulent investment schemes, one of which is a crypto-asset security called Blazar Token, which he claims will replace state pension systems.
Allegedly, John A. DeSalvo, who worked as a prison guard for 15 years, raised at least $620,000 from around 220 investors through the unregistered offering of Blazar Token, which he launched in November 2021 and crashed in May 2022.
According to the SEC’s criminal complaint, DeSalvo told investors that the Blazar Token is registered with the SEC; He lied that he had set up automatic payroll deductions for Blazar Token purchases, and that investors were guaranteed extraordinary returns.
In reality, DeSalvo embezzled and misused investor funds, transferring most of them to personal cryptocurrency wallets.
The SEC said DeSalvo targeted law enforcement and emergency responders with his fraud schemes, using his status as a former prison guard to gain their trust and abuse community sentiment.
Gurbir S. Grewal, Director of the SEC’s Enforcement Department, said:
“We allege that DeSalvo has orchestrated several fraudulent investment schemes targeting law enforcement and promising astronomical returns, one of which includes a crypto-asset security that will somehow replace traditional government pension systems.”
*Not investment advice.
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Source: https://en.bitcoinsistemi.com/sec-charges-a-controversial-altcoin-with-being-a-security-and-its-founder-with-fraud/