Digital Assets: Founding Duo of Zima Digital Assets Arrested In $7.5M Criminal Complaint

February 6, 2020 | Digital Assets, News

Zima Digital Assets focused on investments in crypto- and blockchain-based assets.

The United States Secret Service arrested John Michael Caruso, 28, of Scottsdale, Arizona, and Zachary Salter, 27, of Paradise Valley, Arizona, on January 30, 2020, for allegedly conspiring to commit wire fraud and for money laundering, according to FINANCEFEEDS.

The arrests were announced by the U.S. Attorney’s Office, District of Arizona on February 5, 2020.

Zima Digital Assets Website claims

The website of Zima Digital Assets says the firm “operates various private funds focusing on investments in cutting-edge technologies, including crypto and other blockchain-based assets.”

The Zima website also claims that “the principals at Zima Digital Assets have been investing in long and short cryptocurrency and blockchain technology strategies since 2012. Zima Digital Assets employ’s an array of exotic proprietary trading strategies. Including but not limited to arbitrage opportunities, 80 long / 20 short, binary options positions, event-based trading in addition to leverage, and margin application. Capacity constraint is a hallmark of our firm values”.

MLB players and families lost millions of dollars

The criminal complaint, filed in Arizona Federal Court last week, alleges that Caruso, who called himself “Kryp+0 K!ng,” and his business partner bilked more than 100 investors, including former professional baseball players, out of at least $7.5 million over the past 18 months, as reported by Quartz.

Moreover, according to the court filing, there was no “no evidence any of the investment funds…have gone to any cryptocurrency/digital asset investment, or to any investment of any kind.”

Further, the “pattern of investor payments against investor payouts with no investment of funds is consistent with…a Ponzi scheme,” the complaint alleged.

Luxurious living

According to CRYPTOKNOWMICS, a forensic accountant found that the Zima founders used the money investors handed them for their luxurious cars, private jets, mansion, jewelry and designer dresses.

While Caruso is a history-sheeter, Salter does not have a prior criminal record.

Prosecutors have moved to detain Caruso, calling him a flight risk.

However, Salter was released to his father’s custody, according to Quartz.

Related Story:   Digital Assets: Fraudulent, Unregistered Crypto Firm That Stole from Investment Advisors Shut Down                                               

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.


Latest Alternative Investment News
Digital Assets: Epic Lays Off 830 Employees As Metaverse Underperforms
September 29, 2023     Digital Assets, News

Earlier today, Tim Sweeney, the head of Epic Games, shared an email with the company’s employees, announcing some significant changes within the organization. In this message, Sweeney discussed the necessity…
Artificial Intelligence: Mysterious US-Based Books3 Dataset Used To Train AI Was A Massive Trove Of Pirated Books
September 29, 2023     Artificial Intelligence, Latest News, News

Thousands of books penned by some of Australia’s most esteemed authors may have fallen victim to what Booker prize-winning novelist Richard Flanagan has described as “the biggest act of copyright…銅鑼灣_Causeway_Bay_銅鑼灣時代廣場_Times_Square_office_Tower_One_阿里巴巴_Alibaba_Hong_Kong_June_2022_Px3_03.jpg
FinTech: Ant’s Chongqing Consumer Finance Arm Raising $616M To Ramp Up Loans
September 29, 2023     FinTech, News

Chongqing Consumer Finance, the consumer finance arm of Ant Group, a prominent player in China’s financial technology landscape, is currently in the process of raising a substantial sum of fresh…
Venture Capital: Mercury’s Fund V Mops Up $160M For US Startups “Between The Coasts”
September 29, 2023     News, Venture Capital

Mercury Fund, the premier early-stage venture firm with a focus on non-coastal tech hubs, has successfully closed its largest fund to date, Mercury Fund V, with a total capital commitment…