crypto.news 2025-04-17 17:21:42

Former Goldman Sachs executive arrested for alleged crypto casino fraud

Former Wall Street executive Richard Kim has been arrested and charged with wire fraud and securities fraud for allegedly misappropriating over $4 million from investors in a blockchain-based online casino startup called ZeroEdge. According to a sworn affidavit filed by FBI Special Agent Thomas McGuire in the Southern District of New York, Kim, who previously served as COO of global foreign exchange and emerging markets trading at Goldman Sachs and J.P. Morgan, launched Zero Edge in March 2024. He marketed the company as a crypto-powered casino that would feature on-chain games, a virtual currency called “FAITH,” and a tradeable token dubbed “$RNG.” From March to June 2024, Kim raised approximately $4.3 million through a seed financing round and token sales, pitching investors on a development roadmap that included smart contracts, casino game mechanics, and compliance with gaming and securities regulations. You might also like: Galaxy Digital proposes new voting framework to reduce Solana inflation Fund misappropriation However, prosecutors allege that Kim misrepresented the use of investor funds and diverted money for unauthorized purposes, including speculative cryptocurrency trades. The FBI’s investigation revealed that Kim had promised in formal agreements and token sale documents that the funds would go exclusively toward building the platform. At least one investor told authorities they would not have invested had they known the funds were effectively personal loans to Kim. Kim also cited legal reviews from firms like Greenberg Traurig to reassure investors of regulatory compliance. But according to the complaint, some key agreements were never fully executed or were altered to remove obligations around financial transparency and internal controls. Kim faces charges under Title 18 for wire fraud and securities fraud under federal securities laws. The case remains under investigation. You might also like: Elon Musk’s child proposal to Tiffany Fong — and the events leading up to it