Blazar Token Scam: Former New Jersey Corrections Officer Charged by SEC

blockchain.news:

The U.S. Securities and Exchange Commission (SEC) has charged John A. DeSalvo, a former New Jersey State Correctional Police Officer, with fraudulently raising funds through the unregistered offering of the Blazar Token, a crypto asset security he created. The token saw its downfall in May 2022.

DeSalvo initiated the Blazar Token in November 2021. By the time of its collapse in May 2022, he had amassed at least $620,000 from around 220 investors. DeSalvo had positioned the Blazar Token as a replacement for «existing state pension systems» catering to law enforcement, firefighters, and paramedics. He also falsely conveyed to investors that the token had SEC registration and was available for purchase via automatic payroll deductions, promising them «extraordinary returns.»

The SEC's investigation revealed that DeSalvo misused a significant portion of the investor funds. He transferred a large chunk to his personal crypto asset wallets, with some of these funds being diverted for a bathroom renovation.

Interestingly, DeSalvo's primary targets for his deceptive schemes were law enforcement officials and first responders.

In another twist, starting from late January 2021, DeSalvo had been enticing investors, predominantly through social media platforms, for an investment venture that involved stocks, options, and crypto asset securities. From this venture, he gathered $95,000 from 17 investors. In a brief period, he lost approximately $17,000 in speculative ventures and diverted the leftover $78,000. He later notified the investors that their investments had lost all value because of adverse market trends.

Gurbir S. Grewal, the Director of the SEC’s Division of Enforcement, shed light on the case by stating that DeSalvo