John A. DeSalvo, once an esteemed lieutenant for New Jersey’s Department of Corrections, now faces charges. The U.S. Securities and Exchange Commission (SEC) alleges DeSalvo masterminded a deceptive crypto scheme aimed at police officers and emergency responders.
Blazar Token: A Crypto Dream Too Good to Be True?
From November 2021 to May 2022, DeSalvo attracted 222 investors, amassing $623,388 through his self-promoted Blazar token sales. Marketing it as a groundbreaking solution, DeSalvo promised that Blazar would revamp traditional state pension systems. He envisioned it as a golden opportunity, especially for the police, firefighters, and paramedics, suggesting they’d witness significant returns.
To lure more investors, he boldly claimed:
“Blazar Token stands as the pioneering token available for purchase via weekly pre-tax payroll deductions – a convenience akin to pension, 401k, and IRA contributions.”
However, not all was as it seemed. DeSalvo’s pitch included a glaring false statement. He assured investors, “Our token now holds SEC securitization,” even though Blazar never received such an official nod. But that wasn’t his only deception. He initially promised a “lock-up” period for insider sales. Yet, in stark contrast to this promise, DeSalvo offloaded 41 billion Blazar tokens during its PancakeSwap debut in May 2022. Their worth? A significant $51,000.
Investor Lockdown and Token Value Plunge
While DeSalvo profited, investors found themselves in a bind. They couldn’t offload their Blazar tokens, even as their value plummeted. Shockingly, by May 22, Blazar’s worth had diminished by over 99.9%, mere days post DeSalvo’s sale on PancakeSwap.
As the SEC insightfully observed, “DeSalvo’s extensive sales drove the Blazar Token’s value downward, exhausting PancakeSwap’s liquidity. It culminated in the token’s rapid downfall and significant losses for investors.”
In response to these misdeeds, the SEC is demanding strict actions. They’re pursuing a permanent injunction to prevent DeSalvo from future security offerings. Furthermore, they seek civil penalties and a disgorgement of his ill-gotten gains.
The ambitious Blazar token initiative is a stark reminder. Investors must exercise caution and conduct thorough due diligence before leaping into seemingly lucrative opportunities.
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