Famous investor Richard Kim was this year arrested. Ironically, he had been gambling funds earmarked for a new cryptocasino.  

Famous investor Richard Kim has been arrested. This was because of his misuse of investor funds. We discuss this in the article below.  

Richard Kim, is a former executive who has worked at JP Morgan, Goldman Sachs, and Galaxy. Last year, he admitted that he had gambled away $3.67 million of investor funds. This week he was arrested on charges that he had taken $7 million through misappropriation related to his startup Zero Edge. 

The Arrest of Richard Kim 

The arrest was conducted on Tuesday, April 15th. The complaint was made in the Southern District of New York and said that he had fraudulently induced investors to invest in Zero Edge, then misappropriated millions of dollars of those funds. The FBI added that of the $7 million investors have put in, nearly all have been lost. A large amount of this went into gambling websites, particularly online sportsbooks.   

Reports of this first began to emerge in July last year. Kim admitted in an online interview that he had gambled away over $ 3 million of investor funds through high-leverage crypto trades. It began to go wrong when he was caught out by a phishing site that took $80k of the money. He then believed he had to make it back to preserve his reputation. This then took him to a spiral of “leverage trading, raising more capital and hiding the truth”  

In his own words, Kim reported himself to the U.S. Securities and Exchange Commission using their public tip line. He believed that this was a way of admitting his gross negligence, but that he didn’t intend to run away with the funds. However, there have been major discrepancies in Kim’s account of events and where the funds have actually gone. The flow of money, according to the FBI, has gone to sportsbook accounts and his personal crypto accounts. This is despite the fact that he maintains the line he never mixes business and personal money.   

Modern Investing  

Richard Kim is most well-known for being an angel investor. This is a person who places their money in startups and growing businesses. As well as their finance, they often provide advice and guidance. All of this is done in exchange for a share in the company. Richard Kim is still currently an investor in the social platform Aisle.   

Trading has now changed dramatically, and digital platforms and apps have allowed it to be opened up to a whole new audience. These are not just limited to basic stock and share buying either. You can even access contracts for difference brokers through mobile devices. This allows ultra-fast execution on trades with forex, commodities, shares, metals and energies.    

By using these, it makes trading much easier. You don’t have to go out and find startup companies. Instead, you can watch the global markets and begin trading from your desktop or on the move using a mobile device.   

Who is Richard Kim? 

Richard Kim had previously been an attorney at the law firm Cleary Gottlieb. He then moved into the financial world and became a highly respected figure. He led trading desks at JP Morgan and Goldman Sachs.   

Before founding Zero Edge, he worked at Galaxy Digital, another leading crypto investment company. This former place of work had an immaterial balance sheet investment in Zero Edge and was responsible for reporting him. This is contrary to Kim’s own account. Michael Wursthorn, Head of Communications, said that once he and other investors learned of his actions at Zero Edge, they reported the authorities.   

Kim has been charged with securities and wire fraud. Court records have shown that he has put up a bond of $250,000. There has been $100,000 placed in cash or property to secure it. He has admitted that he had previously battled with gambling addiction. His motivation behind the use of a crypto casino was to provide the services above, as he had been unsatisfied with the unfair practices and opaque advantages held by more traditional operations. It was this that had led him to pitch it to Galaxy Digital and secure funding.   

He has not responded to a request for comment from several media outlets. However, it seems that with his own admittance and that of other companies and investors reporting him, the question is not if this happened, but the way in which it unfolded. His version of events seems currently different from the flow of money, and it is this that will determine his sentence.   

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