This week, the Securities and Exchange Commission announced it had charged Robert Alexander with fraudulently raising roughly $9 million from more than 50 individuals by selling investments in Kizzang LLC. Kizzang was purported to be an online gaming business.
The SEC’s complaint alleges that Alexander told investors they would make a minimum of ten times their investment. Alexander is also accused of telling investors that he personally invested millions in Kizzang, had made a $50 million charitable donation, and had led the creation of a prominent video game.
Instead of using investor funds for Kizzang’s business, Alexander is accused of stealing at least $1.3 million and spending more than $450,000 on gambling sprees. The complaint alleges that Alexander used the investor funds to finance his daily living and other expenses.
The SEC’s complaint was filed in the United States District Court for the Southern District of New York. It charges Alexander and Kizzang with violating the anti-fraud provisions of the Securities Act and Exchange Act. The United States Attorney’s Office for the Southern District of New York announced criminal charges against Alexander as well.
Additional details have been made available here.