Ex-Goldman Sachs, JPMorgan Bigwig Blew Investor Cash in High-Stakes Gambling Spree: DOJ Bombshell

Wall Street's wolves just got a new cautionary tale—straight from the DOJ's playbook.

High-finance heavyweight turned reckless gambler? Check. Millions vaporized in what prosecutors call a 'personal casino'? Double-check. Another reminder that traditional finance's 'trusted stewards' sometimes play with client money like degenerate daytraders? Priceless.

Here's the kicker: this wasn't some back-alley crypto scheme. This was old-school finance royalty allegedly treating investor funds like a VIP blackjack table. The irony? If he'd just YOLO'd into Bitcoin instead, the losses might've at least had narrative symmetry.

Pro tip for the wealthy next time: when bankers start sweating harder than a BTC miner in July, maybe skip the 'alternative investments.'

More on the Investigation into Richard Kim, Zero Edge

The case against Kim relates to Zero Edge, which purportedly planned to develop a blockchain and cryptocurrency-enabled gaming app. “After obtaining investors’ funds, Kim misappropriated them by transferring them to personal accounts, where he made leveraged cryptocurrency trades and gambled away substantially all of the company’s money,” an indictment unsealed Tuesday in U.S. District Court in Manhattan reads. Allegedly, Richard Kim diverted about $3.8 million of investors’ funds shortly after closing on a $4.3 million seed financing round in June 2024, according to the indictment.

The indictment goes on to say that the former Goldman Sachs and JPMorgan executive “concealed from the company’s investors that he had misappropriated the funds and used them at an online casino, telling investors that he had lost the money because of a ‘treasury management strategy’ rather than personal gambling.” Kim was arrested in the case on April 15 after the Manhattan U.S. Attorney’s office filed a criminal complaint in that court, before he was released on bond.

A Galaxy spokesman said, in a statement, “Richard Kim left Galaxy in March 2024 to start Zero Edge, a company in which Galaxy had an immaterial balance-sheet investment. Upon learning of certain actions taken by Mr. Kim in his role at Zero Edge, we, along with other investors, reported his conduct to the authorities.”