SEC v. John A. DeSalvo, No. 2:23-cv-08092, District of New Jersey (Aug. 23, 2023) — Complaint

Counsel of Record:
Christopher R. Kelly
Gregory R. Bockin
Securities and Exchange Commission
Philadelphia Regional Office
1617 JFK Blvd., Suite 520
Philadelphia, PA 19103
Telephone: 215-597-3100
Facsimile: 215-597-2740

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

SECURITIES AND EXCHANGE
COMMISSION,

                        Plaintiff,

            v.

JOHN A. DESALVO,

                        Defendant.

    Case No. 23-cv-8092

    COMPLAINT

    JURY TRIAL DEMANDED

 Plaintiff Securities and Exchange Commission (the “Commission”), 1617 JFK Blvd.,
Suite 520, Philadelphia, Pennsylvania, 19103, alleges as follows against Defendant John A.
DeSalvo (“DeSalvo”), 2211 Shore Road, Linwood, New Jersey, 08221:
SUMMARY

1. This case involves a brazen crypto asset securities fraud coupled with a separate
investment fraud perpetrated by Defendant DeSalvo, a former New Jersey corrections officer
who targeted law enforcement and first responders with his fraudulent schemes.
2. DeSalvo created the so-called “Blazar Token,” a crypto asset security that he
claimed would eventually replace traditional state pension systems.  From the launch of Blazar
Token’s so-called initial coin offering (“ICO”) in November 2021, to its eventual collapse in
May 2022, DeSalvo raised at least $623,888 from approximately 222 investors.

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3. In offering the Blazar Token to prospective investors, DeSalvo made numerous
materially misleading statements and omissions, including, but not limited to, that: (1) the Blazar
Token was registered with the Commission; (2) DeSalvo had arranged for the Blazar Token to be
purchased through automated payroll deduction; and (3) investors were guaranteed to receive
extraordinary investment returns.  DeSalvo also used much of the investor funds he received
from the Blazar Token offering for improper purposes.
4. Additionally, in May 2022—within days of when the Blazar Token was first
offered on the crypto asset trading platform PancakeSwap—Defendant DeSalvo sold
approximately 41 billion Blazar Tokens, notwithstanding the fact that he and the other Blazar
Token investors who participated in the ICO were still in their purported lock-up period.
DeSalvo’s massive volume of sales placed downward pressure on the Blazar Token’s trading
price and drained PancakeSwap of the majority of its liquidity in the investment, resulting in its
collapse and substantial investor losses.
5. The Blazar Token scheme was not the first time that DeSalvo had defrauded
investors and misappropriated their funds.  Through a separate investment fraud scheme that he
started in late January 2021, DeSalvo solicited investors, primarily through Facebook, to
participate in an investment program that he often referred to as the “E*Trade Invest Group.”
Between February 3 and February 10, 2021, DeSalvo raised approximately $95,000 from 17
investors.
6. Shortly after depositing the investor funds in his brokerage account, however,
DeSalvo lost a significant amount of the money making speculative investments.  He then
misappropriated the remaining $78,000 by, among other things, transferring the money to his
personal crypto asset wallets and paying a contractor to complete a bathroom renovation.  To

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conceal his conduct, DeSalvo told the E*Trade Invest Group investors that he lost their money
due to poor market performance.
7. By engaging in the conduct described in this Complaint, Defendant violated, and
unless enjoined will continue to violate, Section 10(b) of the Securities Exchange Act of 1934
(“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5] and
Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C.
§§ 77(e)(a) and (c) and 77q(a)].
JURISDICTION AND VENUE
8. The Commission brings this action pursuant to Sections 21(d) and 21(e) of the
Exchange Act [15 U.S.C. §§ 78u(d) and (e)] and Sections 20(b) and 20(d) of the Securities Act
[15 U.S.C. §§ 77t(b) and (d)] to permanently enjoin Defendant from engaging in such
transactions, acts, practices, and courses of business alleged in this Complaint, and to obtain
disgorgement, prejudgment interest, and civil money penalties, and such other and further relief
as the Court may deem just and appropriate.
9. This Court has jurisdiction over this action pursuant to Sections 21(d), 21(e), and
27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa] and Sections 20(b), 20(d), and
22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)].
10. Venue in this District is proper pursuant to Section 27 of the Exchange Act
[15 U.S.C. § 78aa] and 22(a) of the Securities Act [15 U.S.C. § 77v(a)].  Defendant is located,
resides, and transacts business in the District of New Jersey.  Additionally, certain of the
transactions, acts, practices, and courses of business constituting the violations alleged herein
occurred within the District of New Jersey, and were effected, directly or indirectly, by making

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use of the means or instruments or instrumentalities of transportation or communication in
interstate commerce, or of the mails, or the facilities of a national securities exchange.
DEFENDANT
11. John A. DeSalvo, age 47, is a resident of Linwood, New Jersey.  He is the
Founder and CEO of Blazar Token And The Moonfuel Protocol, LLC.  He is a former
Lieutenant in the New Jersey Department of Corrections and is the owner of a parking lot
sealcoating company.
RELATED ENTITY AND INDIVIDUAL
12. Blazar Token And The Moonfuel Protocol, LLC (“BTMP”), was incorporated
in mid-May 2022 as a New Jersey limited liability company with a principal place of business in
Marmora, New Jersey.  BTMP operated as DeSalvo’s alter ego in that DeSalvo controlled it.
Neither the Blazar Token itself nor BTMP are, or were at any time, registered with the
Commission in any capacity.  Nor were any offers or sales of the Blazar Token or BTMP
registered with the Commission.
13. Former Blazar Token Partner, age 36, is a resident of Williamstown, New
Jersey.  From January 2022 to May 2022, he was a partner in connection with DeSalvo’s efforts
to launch the Blazar Token.  He is a police officer in a New Jersey township.
FACTS
DeSalvo Offered and Sold the Blazar Token as Securities
14. Starting in approximately November 2021, DeSalvo offered investors
opportunities to profit from crypto-asset related investments in the Blazar Token.

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15. All told, DeSalvo raised at least $623,888 from approximately 222 investors in
connection with his offering of the Blazar Token.  DeSalvo accepted payment for Blazar Token
investments in both cash and crypto assets.
16. DeSalvo developed and pitched the Blazar Token as an alternative to state
pension systems for police officers, fire personnel, and first responders.  In a Blazar Token
“whitepaper,” which DeSalvo drafted to provide prospective investors with details about the
project, DeSalvo wrote that investors would “transition out of the current pension system and
into one of the future” by purchasing the Blazar Token.
17. The whitepaper also described the Blazar Token as “the first token or coin that is
able to be purchased through payroll deduction every week,” and stated that “it will be taken out
of one’s weekly earnings pretax similar to payment into a pension, 401k, IRA or any other
retirement savings plans.”
18. DeSalvo primarily marketed and solicited prospective investors in the Blazar
Token with a focus on law enforcement personnel through various online media, including in
Facebook groups relating to law enforcement officer investing, Telegram, Stocktwits, multiple
websites that he created for the project, and on his personal Facebook page.  DeSalvo also
contacted prospective Blazar Token investors through direct phone calls and electronic messages
to his network of contacts.
19. DeSalvo also used paid press release distribution services to market the Blazar
Token.  In one such press release dated December 5, 2021, entitled “Blazar Initial Token
Offering is Already a Huge Hit,” DeSalvo wrote that “enthusiastic customers have lapped up the
Blazar Token, making it one of the biggest token launches in recent times.”

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20. In connection with his solicitation of Blazar Token investors, DeSalvo
disseminated a contract that set forth, among other things, how Blazar Token’s management
team would use investor funds.  Specifically, the contract stated that “proceeds from token sales
during the ICO will be used for the development of the token, gas fees, advertising, marketing,
exchange listing fees, and liquidity.”
21. The contract also stated that “there will be absolutely no use of Blazar Token’s
funds for the self-interest of any Member of Blazar Token’s management team.”
22. Initially, DeSalvo was solely responsible for launching the Blazar Token.
DeSalvo’s responsibilities included developing Blazar Token’s whitepaper, creating marketing
materials, generating “buzz” on social media, and soliciting investors.
23. In January 2022, in exchange for an investment of approximately $25,000,
DeSalvo brought on Former Blazar Token Partner, a New Jersey police officer, as a partner in
the development of the Blazar Token.  Former Blazar Token Partner reported to DeSalvo, and
was primarily responsible for assisting in the solicitation of investors and overseeing the
software developers hired to build and code Blazar Token’s smart contract.
24. Despite Former Blazar Token Partner’s role as partner and his involvement in the
day-to-day operations of developing the Blazar Token, DeSalvo retained full control over all
Blazar Token-related decision making.  For example, only DeSalvo had access to the bank
accounts and crypto asset wallets where investor funds were deposited and was responsible for
all decisions regarding the use of investor funds.
25. DeSalvo launched Blazar Token’s ICO in early November 2021.  Most ICO
purchasers received “placeholder tokens” initially, during the development, and prior to the

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actual launch, of the Blazar Token, but those placeholders were replaced by actual Blazar Tokens
in April 2022.
26. On April 21, 2022, the Blazar Token was first offered for trading on the crypto
asset trading platform PancakeSwap.
27. Investments in the Blazar Token were investments in a common enterprise.
28. DeSalvo commingled both the cash and crypto asset investments that he received
from Blazar Token investors with his personal funds in personal accounts held in his name.
29. DeSalvo purported to use funds received from Blazar Token investors to fund and
develop the marketing of the Blazar Token.
30. DeSalvo pitched the Blazar Token as an investment opportunity and boasted that
investors in the Blazar Token would receive substantial profits from their investments based on
the appreciation in its price.
31. Had the Blazar Token appreciated in value and been successful as an investment
opportunity, investors would have reasonably expected to share in that success equally through
an increase in the value of their respective Blazar Tokens.
32. Based upon DeSalvo’s public statements as further set forth below, investors had
a reasonable expectation of profits to be derived from DeSalvo’s efforts.  The profits of the
Blazar Token investors were to be the result of DeSalvo’s efforts to procure additional
investments, including as a result of automatic payroll deductions.  In particular, DeSalvo
claimed that increases in the Blazar Token’s future trading price would be directly linked to his
ability to register a large number of payroll deduction “accounts.”

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33. DeSalvo offered to sell, and in fact sold, Blazar Tokens in a general solicitation
through the mails or use of means or instruments of transportation or communication in interstate
commerce.
34. DeSalvo offered and sold Blazar Tokens to investors living in at least 11 states
through multiple channels, including Facebook, telephone, and email, while there was no
registration statement filed or in effect as to the Blazar Token offering.
35. DeSalvo did not take reasonable steps to verify the accreditation status of the
investors in the Blazar Token, and at least some of the investors in the Blazar Token were not
accredited.
DeSalvo Made False and Misleading Statements
and Omissions about the Blazar Token

36. DeSalvo made numerous false and misleading statements and omissions about the
Blazar Token, including that:  (1) the Blazar Token was registered with the Commission;
(2) DeSalvo had arranged for Blazar Tokens to be purchased through automated payroll
deductions; and (3) the Blazar Token was guaranteed to provide exorbitant returns.
DeSalvo Falsely Claimed that the Blazar Token Was Registered With the Commission

37. Beginning in at least November 2021 and continuing through April 2022, in press
releases, phone calls, and Facebook posts, DeSalvo told investors that he had registered the
Blazar Token with the Commission.
38. For example, in a December 2021 private Facebook message to an investor who
questioned whether the Blazar Token was registered as a security, DeSalvo wrote, “With the
SEC yes.  We are the FIRST EVER!!!”
39. In a January 2022 Stocktwits post promoting the Blazar Token ICO, DeSalvo
wrote, “we became a securitized token with the SEC.”

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40. Additionally, in April 2022, in response to a prospective investor who would not
invest if the Blazar Token were not “SEC registered,” DeSalvo replied, “I’ve been designated a
securitized token by the SEC already.”
41. During the same period, and despite having told certain investors that the SEC
registration was finalized, DeSalvo authored at least four press releases that stated he was in the
process of applying to the Commission to have the Blazar Token designated a “securitized
token.”
42. DeSalvo later sought ideas for how to frame the Blazar Token as a so-called
“utility” token in an apparent attempt to avoid regulatory oversight.
43. In a private voice message, DeSalvo stated “Blazar is sure as hell a security token
. . . we want to come up with some bullshit that says it’s doing something not to do with money.”
44. For at least some of the investors in the Blazar Token, Blazar Token’s purported
registration with the Commission was one of the primary reasons they felt comfortable investing
with DeSalvo, as it added a sense of legitimacy to the ICO.
45. In reality, the Blazar Token was not registered with the Commission, nor had the
Blazar Token submitted any draft (or other) registration statements to the Commission, nor were
any registration statements filed or in effect as to any offer or sale of Blazar Tokens.  DeSalvo
knew, or was reckless in not knowing, these facts.
DeSalvo Falsely Claimed that He Had Arranged for the Blazar
Token to be Purchased Through Automated Payroll Deduction

46. DeSalvo pitched the Blazar Token to investors as a “pension supplement” and
claimed it was designed to allow investors to purchase Blazar Tokens through automatic payroll
deduction.

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47. DeSalvo referred to this feature as a “crypto first” and claimed that increases in
the Blazar Token’s future trading price would be directly linked to his ability to register a large
number of payroll deduction “accounts.”
48. As he communicated to investors, DeSalvo’s investment pitch was that the steady
stream of weekly purchases via payroll deduction would increase the demand for the Blazar
Token and, in turn, its trading price.  Without automated payroll deduction, however, there
would be significantly less demand for the Blazar Token, which would have a negative impact
on its price.
49. In his first post on the Facebook All [Law Enforcement Officer] Crypto Group in
November 2021, DeSalvo wrote:  “We have already secured being listed as a Payroll Deduction
in 11 states.”
50. In the next several weeks, DeSalvo wrote in at least three press releases that
investors were able to purchase Blazar Tokens through payroll deductions.
51. In April 2022, in a Telegram post to the Blazar Token investor community, he
claimed that the Blazar Token was the “1st token ever to have over 25,000 ACH accounts ready
to go for weekly deductions!”
52. These statements were important to many of the Blazar Token investors when
determining whether or not to purchase the Blazar Token.
53. DeSalvo’s statements to Blazar Token’s investors and prospective investors about
the availability of an automated payroll deduction to purchase the Blazar Token were false or
misleading, as demonstrated by DeSalvo’s own statements in texts and private Facebook
messages.

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54. In March 2022, DeSalvo texted one of his developers:  “[Former Blazar Token
Partner] and I need to contact a lot of places to try to get payroll/ACH rolling.”
55. In April 2022, DeSalvo told a Blazar Token investor:  “[W]hat I really need to
figure out is a company that will allow us to have ACH,” and messaged another investor:
“[W]hat we need bro is ACH. I can’t find anyone to take it.”
DeSalvo Falsely Guaranteed Exorbitant Blazar Token Returns
56. DeSalvo falsely guaranteed that Blazar Token investors would receive exorbitant
returns on their investments.
57. Among other guarantees, DeSalvo promised at least one investor that the price
would appreciate 300% when trading commenced on PancakeSwap, such that their $25,000
investment would yield income of $100,000 per month and would be worth $1 million within
one year.
58. DeSalvo falsely promised a number of other investors that he would pay their
money back if the value of Blazar Tokens depreciated.
59. DeSalvo also made other false and outlandish return guarantees to prospective
investors in writing, including:
a) “This is a GUARANTEED MINIMUM 100X Your money”;
b) “What if I told you BLAZAR Token can get you 22.1% GUARANTEED
and it's not a lie?  Well we can ... 22% GUARANTEED with ZERO
risk”; and
c) “This is no longer a maybe, it’s as solid as solid gets with the highest
average annual return EVER seen on large sums of money.  To be able to

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guarantee someone 20%+ on BILLIONS of dollars has NEVER been seen
EVER.  Well that’s about to.”
60. DeSalvo made these statements concerning the guaranteed investment returns on
the Blazar Token without any reasonable basis to believe they were true.
61. DeSalvo’s public statements concerning the lofty returns omitted any language
concerning the risks associated with investing in ICOs, crypto assets, or securities more broadly.
DeSalvo Misappropriated Blazar Token Investor Funds and Used
Investor Funds in a Manner Inconsistent With Statements to Investors
62. Of the at least $623,888 that DeSalvo raised in the Blazar Token offering, the
majority of it was deposited into DeSalvo’s personal bank account or one of several crypto asset
wallets under his control.  As a result, DeSalvo had access to the Blazar Token investor proceeds
and exclusive control over how such funds were used.
63. Although DeSalvo told investors that their funds would be used solely for
development of the Blazar Token, and for gas fees, advertising, marketing, “exchange listing
fees,” and liquidity associated with it, DeSalvo misappropriated investor funds and used investor
proceeds in a manner inconsistent with his disclosures to investors.
64. First, DeSalvo used investor funds for his personal expenditures.
65. Between November 2021 and May 2022, nearly $267,000 in investor cash was
routed through DeSalvo’s personal bank account.
66. DeSalvo misappropriated approximately $54,000 of investor funds in order to pay
for his personal expenditures and cash withdrawals.
67. Second, DeSalvo misappropriated ether (“ETH”) received from investors, as well
as ETH purchased with investor funds.

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68. Between November 2021 and May 2022, DeSalvo accumulated more than 14
ETH received from Blazar Token investors or purchased with investor funds, which at the time
was worth more than $47,000.
69. On August 30, 2022, after Blazar had collapsed, and without investor knowledge
or approval, DeSalvo sold all of his ETH and transferred the proceeds to his personal bank
account.  DeSalvo then transferred a portion of such funds to personal brokerage accounts and
spent the rest on personal expenses.
70. Third, DeSalvo regularly sent Blazar Token investor funds to his personal crypto
asset wallets, where he speculated in other, more volatile crypto assets.
71. For example, in May 2022, an investor transferred 1.07 bitcoin (“BTC”) valued at
more than $41,000 to a DeSalvo-controlled crypto asset wallet as a means to fund a Blazar
Token purchase.  The following day, DeSalvo sold 1.07 BTC for $41,090 and used the proceeds
to purchase nearly 11,000 Kyber Network Crystal (“KNC”) tokens.
72. Over the next week, KNC’s trading price plummeted and, by mid-May, DeSalvo
had sold nearly all of the KNC that he purchased using investor funds and realized losses of
more than $18,500—approximately 45%—of the investor’s funds, which were supposed to be
used to fund the development of the Blazar Token.
73. Fourth, DeSalvo used investor funds to repay an investor who threatened legal
action against him.
74. In May 2022, many investors noted the precipitous decline in the price of the
Blazar Token from its early trading levels and confronted DeSalvo to determine the reasons for
its poor performance.

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75. Rather than tell his investors the truth—that the price decline was largely the
result of his substantial selling of his own Blazar Tokens—DeSalvo lied and claimed it was
Former Blazar Token Partner who had sold a large number of Blazar Tokens, and that he had
fired Former Blazar Token Partner and was considering legal action.
76. To placate an investor who threatened to sue, DeSalvo repaid him with tether
(USDT) valued at $21,353, using previously raised funds from another investor.
77. This was the only time any of the ICO investors received any money back from
DeSalvo for their investment.
DeSalvo Made Money to the Detriment of the Other Investors in the Blazar
Token by Selling a Large Quantity of his Blazar Tokens During the Lock-Up Period
78. The Blazar Token ICO concluded on April 21, 2022, when the Blazar Token was
made available for trading on PancakeSwap.
79. Pursuant to the terms of the contract drafted by DeSalvo, and provided to at least
some investors, however, investors in the Blazar Token ICO were prohibited from selling their
Blazar Tokens for a ninety-day window after the ICO.  The contract also stated that the
“founders tokens” owned by DeSalvo could not be sold for six months post-ICO.  The Blazar
Token whitepaper represented to investors and prospective investors that DeSalvo had an even
longer lock-up period that prevented him from selling for one year.
80. Notwithstanding these promised limitations, between May 11 and May 22,
2022—during the lock-up period in which DeSalvo had represented that he would not sell his
“founders tokens”—DeSalvo sold more than 41 billion Blazar Tokens (which included his
“founders tokens”) on PancakeSwap.  This represented substantially all of the Blazar Tokens that
DeSalvo controlled and was worth the equivalent of $51,000.

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81. DeSalvo’s massive sales volume had a dramatic negative impact on Blazar
Token’s trading price—resulting ultimately in the collapse of the price of the Blazar Token—
and, consequently, investors suffered significant losses on their investments.
82. For example, a Blazar Token investment that was worth approximately $1,000
prior to DeSalvo’s first sales on May 11 was only worth approximately $0.41 after DeSalvo’s
sales on May 22.
83. DeSalvo received all of the funds from his Blazar Token sales into one of his
personal crypto asset wallets.
84. The Blazar Token price never recovered following its collapse after DeSalvo’s
sales, and the large majority of Blazar Token purchasers are left holding these nearly worthless
crypto asset securities.
85. DeSalvo knew, or was reckless in not knowing, (1) that he had represented that he
would not sell his “founders tokens” during this time period; and (2) the likely adverse effect that
his sales activity would have on the price of the Blazar Token.
The E*Trade Investment Group Fraud

86. Prior to his Blazar Token scheme, beginning in late January 2021, DeSalvo
engaged in a securities investment fraud scheme in connection with what he called the “E*Trade
Invest Group.”
87. On January 19, 2021, DeSalvo opened an E*Trade brokerage account in his own
name.  DeSalvo established no legal entity for the investment group.
88. Prior to receiving funds from any investment group participants, the account was
valued at $380.

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DeSalvo Solicited Investors to Participate in an Investment Group
89. DeSalvo primarily solicited investors for the “E*Trade Invest Group” on his
personal Facebook page, telling them that he was seeking to raise a total of $100,000 from 20
people.  In a Facebook post, DeSalvo also provided instructions on how to transfer funds directly
into his E*Trade brokerage account.
90. In emails to investors, DeSalvo explained that he would invest their funds in
various securities, including options, stocks, and crypto assets.
91. Between February 3 and February 10, 2021, 17 investors sent DeSalvo a total of
$95,000 to participate in the investment group.  Other than the initial $380, DeSalvo did not put
any additional personal funds into the account.
92. DeSalvo told investors that their money would grow significantly because of his
investment expertise.
93. In an email to investors, DeSalvo stated, “I have been averaging close to 1200%
over the last 2 years.  I am in the top 1,000th percent in the world.”
94. In a private Facebook message to an investor, DeSalvo stated, “I’ve done this
three times since the summer.  I’m not guaranteeing we get the same results, but so far the other
three accounts are all over one-half million and they started with over $25,000....”
95. His pitch was simple:  because of his purported track record investing, all the
investors needed to do was, as he put it in one Facebook post, “sit back and relax and get rich.”
96. DeSalvo told investors that his goal for the fund was to turn the $100,000 initial
investment pool into $1 million by the end of the summer.
97. These statements were false and misleading.

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98. Contrary to his representations, DeSalvo was not averaging close to 1,200 percent
on his investments over the last two years, nor did he otherwise have the investment track record
that he claimed to have.
99. DeSalvo also did not invest the funds raised for the investment group’s benefit.
DeSalvo Misappropriated Investor Funds for His Own Personal Benefit

100. DeSalvo initially purchased securities in his E*Trade brokerage account that he
had opened in January 2021 in a manner consistent with his statements to investors.
101. In early February 2021, DeSalvo primarily purchased highly speculative, near-
expiration call options as well as equity securities.
102. In the first week, the investments performed well, rising in value to over
$140,000.  DeSalvo also sent the investors near daily emails with general comments on holdings
and daily performance.
103. However, beginning on February 10, 2021, and continuing over the next trading
week, the investment group’s holdings lost nearly 50% of their value from their prior highs.
104. By February 18, 2021, the group’s holdings were only worth approximately
$77,000.
105. As the account’s value began to decline, DeSalvo stopped sending emails to his
investors.
106. As the investment group’s holdings lost value, DeSalvo also began transferring
funds out of his E*Trade brokerage account for his own personal benefit.
107. On February 11, 2021, DeSalvo transferred $4,656 from the brokerage account to
one of his personal bank accounts to pay credit card bills and to withdraw cash from an ATM.

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108. Between February 19 and February 24, 2021, DeSalvo liquidated the remaining
positions and transferred the funds—more than $78,000—to his personal bank account.
109. On February 24, 2021, in a private Facebook message, after draining the
brokerage account, DeSalvo told one investor: “We’re done. Biggest crash of the Nasdaq in 27
years. . . . 11 of 13 days down in a row.”
110. Of the over $82,000 that he misappropriated from his investors, DeSalvo:
(1) transferred over $56,000 to one of his personal crypto wallets; (2) issued a $10,000 check to a
contractor who was in the process of renovating his bathroom; and (3) transferred more than
$6,000 to a brokerage account in the name of his daughter.
111. In his crypto asset wallet, DeSalvo traded various speculative and volatile crypto
assets and made frequent transfers both to and from his other crypto asset wallets, his personal
bank account, and his brokerage accounts.
112. In sum, DeSalvo looted the group’s brokerage account, and it ended February
2021 with a zero balance.  DeSalvo kept the majority of their money for himself and returned
none of it to his investors.
DeSalvo Lied to Investors to Conceal His Misconduct

113. In mid-May 2021, DeSalvo resumed sending emails to the investment group.
114. DeSalvo apologized to the group, claiming that he was “just notified” that no one
had received any of the 77 emails he had purportedly sent to the group since February,
notwithstanding the fact that an investor had emailed him more than two months earlier asking
why he had stopped communicating with them.

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115. DeSalvo falsely told his investors that the account had suffered significant losses
due to the White House’s infrastructure plans and that the account ended February with around
$27,000.
116. Subsequent emails from DeSalvo continued to claim that he lost their money due
to poor market performance.  DeSalvo did not disclose to the investors his misappropriation of
their funds.
Defendant Violated the Securities Laws

117. The investments in the Blazar Token offered and sold by Defendant were
securities within the meaning of the Securities Act and Exchange Act.  The investments to be
purchased or sold by Defendant in connection with the E*Trade Invest Group also were
securities within the meaning of the Securities Act and Exchange Act.
118. An investment contract (a type of security) exists when individuals or entities:
(a) invest money or otherwise exchange value (including dollars, crypto assets, and other
consideration such as labor); (b) in a common enterprise; (c) with a reasonable expectation of
profits to be derived from the entrepreneurial and managerial efforts of others.
119. Blazar Token investors provided DeSalvo with money or otherwise exchanged
value in connection with their investments.
120. The investments in the Blazar Token were all in a common enterprise.  Investors
played no role in the management or operations of the businesses of the Blazar Token.
121. Defendant repeatedly told investors that the value of the Blazar Token would
significantly increase based upon Defendant’s efforts.  Blazar Token investors expected profits
to be derived from DeSalvo’s efforts.

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122. Neither the Blazar Token itself, nor BTMP, are, or were at any time, registered
with the Commission in any capacity.  Nor were any registration statements filed or in effect as
to any offer or sale of Blazar Tokens or BTMP.
123. Defendant’s offer and sale of the Blazar Token was a general solicitation through
the mails or use of means or instruments of transportation or communication in interstate
commerce.
124. Through multiple channels, including Facebook, telephone, and email, DeSalvo
offered and sold Blazar Tokens to investors living in at least 11 states.
125. At least some of the investors in the Blazar Token were not accredited and, in any
event, DeSalvo did not take reasonable steps to verify the accreditation status of the investors.
126. DeSalvo engaged in the offer and sale of the securities of the Blazar Token by use
of the means or instruments of transportation or communication in interstate commerce, the
instrumentalities of interstate commerce, and/or by use of the mails.
127. Directly or indirectly, DeSalvo made materially false and misleading statements
and omissions to Blazar Token investors and prospective investors concerning, among other
things:  (1) whether the Blazar Token (or its offer/sale) was registered with the Commission; (2)
whether DeSalvo had arranged for the Blazar Token to be purchased through automated payroll
deductions; (3) whether the Blazar Token was guaranteed to provide exorbitant returns; and (4)
DeSalvo’s use of investor funds.  Defendant, directly or indirectly, knowingly or recklessly made
such material untrue statements and omitted to state material facts necessary in order to make the
statements made, in light of the circumstances under which they were made, not misleading.
128. Directly or indirectly, DeSalvo made materially false and misleading statements
and omissions to E*Trade Invest Group investors and prospective investors concerning:  (1) his

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prior returns from other investment groups; and (2) DeSalvo’s use of investor funds.  Defendant,
directly or indirectly, knowingly or recklessly made such material untrue statements and omitted
to state material facts necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading.
129. A reasonable investor would consider the misrepresented facts and omitted
information described herein important in deciding whether or not to invest.
130. The untrue statements of material fact and material omissions described herein
were made in the offer or sale and/or in connection with the purchase or sale of securities.
131. In connection with the conduct described herein, Defendant acted knowingly or
recklessly.  Defendant knew or was reckless in not knowing that Defendant was making material
misrepresentations and omitting to state material facts necessary to make certain statements not
misleading under the circumstances.
FIRST CLAIM FOR RELIEF

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder

132. The Commission re-alleges and incorporates by reference each and every
allegation in paragraphs 1 through 131, inclusive, as if they were fully set forth herein.
133. By engaging in the conduct described above in connection with the Blazar Token
and E*Trade Invest Group, Defendant, knowingly or recklessly, in connection with the purchase
or sale of securities, directly or indirectly, by use the means or instrumentalities of interstate
commerce, or the mails, or the facilities of a national securities exchange:
a) employed devices, schemes or artifices to defraud;

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b) made untrue statements of material facts or omitted to state material facts
necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading; and/or
c) engaged in acts, practices, or courses of business which operated or would
operate as a fraud or deceit upon any person in connection with the
purchase or sale of any security.
134. By engaging in the foregoing conduct, Defendant violated, and unless enjoined
will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5
[17 C.F.R. § 240.10b-5], thereunder.
SECOND CLAIM FOR RELIEF

Violations of Section 17(a) of the Securities Act

135. The Commission re-alleges and incorporates by reference each and every
allegation in paragraphs 1 through 131, inclusive, as if they were fully set forth herein.
136. By engaging in the conduct described above in connection with the Blazar Token,
Defendant knowingly or recklessly, in the offer or sale of securities, directly or indirectly, by the
use of means or instruments of transportation or communication in interstate commerce or by use
of the mails:
a) employed devices, schemes, or artifices to defraud;
b) obtained money or property by means of untrue statements of material fact
or omissions to state material facts necessary in order to make the
statements made, in light of the circumstances under which they were
made, not misleading; and/or
c) engaged in transactions, practices, or courses of business which operated

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or would operate as a fraud or deceit upon purchasers of securities.
137. By engaging in the foregoing conduct, Defendant violated, and unless enjoined
will continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)].
THIRD CLAIM FOR RELIEF

Violations of Section 5(a) and (c) of the Securities Act
138. The Commission re-alleges and incorporates by reference each and every
allegation in paragraphs 1 through 131, inclusive, as if they were fully set forth herein.
139. By engaging in the conduct described above in connection with the Blazar Token,
Defendant, directly or indirectly:
a) made use of the means or instruments of transportation or communication
in interstate commerce or of the mails to sell, through the use of medium
of any prospectus or otherwise, securities as to which no registration
statement was in effect;
b) for the purpose of sale or delivery after sale, carried or caused to be
carried through the mails or in interstate commerce, by means or
instruments of transportation, securities as to which no registration
statement was in effect; and/or
c) made use of means or instruments of transportation or communication in
interstate commerce or of the mails to offer to sell, through the use or
medium of any prospectus or otherwise, securities as to which no
registration statement had been filed.
140. By engaging in the foregoing conduct, Defendant violated, and unless enjoined
will continue to violate, Sections 5(a) and (c) of the Securities Act [15 U.S.C. §§ 77e(a) and (c)].

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PRAYER FOR RELIEF
 WHEREFORE, the Commission respectfully requests that the Court enter a final
judgment:
I.
 Permanently restraining and enjoining Defendant DeSalvo from, directly or indirectly,
violating Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17
C.F.R. § 240.10b-5], and Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§
77(e)(a) and (c) and 77q(a)];
II.
Permanently restraining and enjoining Defendant DeSalvo from, directly or indirectly,
including, but not limited to, through any entity he owns or controls, participating in the
issuance, offer, or sale of any security, including any crypto asset security; provided, however,
that such injunction shall not prevent him from purchasing or selling securities for his own
personal accounts;
III.
Ordering Defendant DeSalvo to disgorge ill-gotten gains as a result of the violations
alleged herein, together with prejudgment interest thereon, pursuant to Exchange Act Sections
21(d)(3), 21(d)(5) and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), 78u(d)(5), and 78u(d)(7)];
IV.
 Ordering Defendant DeSalvo to pay civil penalties pursuant to Section 21(d)(3) of the
Exchange Act [15 U.S.C. § 78u(d)(3)] and Section 20(d) of the Securities Act [15 U.S.C. §
77t(d)] for violations of the federal securities laws as alleged herein; and

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V.
Granting such other and further relief as this Court may deem just and proper.

Dated:  August 23, 2023          Respectfully submitted,

BY: ______________________
Christopher R. Kelly
 Gregory R. Bockin
Philadelphia Regional Office
One Penn Center
1617 JFK Blvd., Suite 520
Philadelphia, PA  19103
Telephone: (215) 597-3100
Facsimile: (215) 597-2740
[email protected]
[email protected]
Attorneys for Plaintiff
SECURITIES AND EXCHANGE
COMMISSION

Of Counsel:

Assunta Vivolo
Brian P. Thomas
David W. Snyder

Counsel of Record: 
Christopher R. Kelly 
Gregory R. Bockin 
Securities and Exchange Commission 
Philadelphia Regional Office 
1617 JFK Blvd., Suite 520 
Philadelphia, PA 19103 
Telephone: 215-597-3100 
Facsimile: 215-597-2740 

 
IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF NEW JERSEY 
 

SECURITIES AND EXCHANGE 
COMMISSION, 
 
  Plaintiff, 
 
 v. 
 
JOHN A. DESALVO, 
 
  Defendant. 
 

 
    Case No. 23-cv-8092 

 
    COMPLAINT 
 
    JURY TRIAL DEMANDED 

 

 

 
 Plaintiff Securities and Exchange Commission (the “Commission”), 1617 JFK Blvd., 

Suite 520, Philadelphia, Pennsylvania, 19103, alleges as follows against Defendant John A. 

DeSalvo (“DeSalvo”), 2211 Shore Road, Linwood, New Jersey, 08221: 

SUMMARY 
 

1. This case involves a brazen crypto asset securities fraud coupled with a separate 

investment fraud perpetrated by Defendant DeSalvo, a former New Jersey corrections officer 

who targeted law enforcement and first responders with his fraudulent schemes. 

2. DeSalvo created the so-called “Blazar Token,” a crypto asset security that he 

claimed would eventually replace traditional state pension systems.  From the launch of Blazar 

Token’s so-called initial coin offering (“ICO”) in November 2021, to its eventual collapse in 

May 2022, DeSalvo raised at least $623,888 from approximately 222 investors.    

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3. In offering the Blazar Token to prospective investors, DeSalvo made numerous 

materially misleading statements and omissions, including, but not limited to, that: (1) the Blazar 

Token was registered with the Commission; (2) DeSalvo had arranged for the Blazar Token to be 

purchased through automated payroll deduction; and (3) investors were guaranteed to receive 

extraordinary investment returns.  DeSalvo also used much of the investor funds he received 

from the Blazar Token offering for improper purposes. 

4. Additionally, in May 2022—within days of when the Blazar Token was first 

offered on the crypto asset trading platform PancakeSwap—Defendant DeSalvo sold 

approximately 41 billion Blazar Tokens, notwithstanding the fact that he and the other Blazar 

Token investors who participated in the ICO were still in their purported lock-up period.  

DeSalvo’s massive volume of sales placed downward pressure on the Blazar Token’s trading 

price and drained PancakeSwap of the majority of its liquidity in the investment, resulting in its 

collapse and substantial investor losses.   

5. The Blazar Token scheme was not the first time that DeSalvo had defrauded 

investors and misappropriated their funds.  Through a separate investment fraud scheme that he 

started in late January 2021, DeSalvo solicited investors, primarily through Facebook, to 

participate in an investment program that he often referred to as the “E*Trade Invest Group.”  

Between February 3 and February 10, 2021, DeSalvo raised approximately $95,000 from 17 

investors.   

6. Shortly after depositing the investor funds in his brokerage account, however, 

DeSalvo lost a significant amount of the money making speculative investments.  He then 

misappropriated the remaining $78,000 by, among other things, transferring the money to his 

personal crypto asset wallets and paying a contractor to complete a bathroom renovation.  To 

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conceal his conduct, DeSalvo told the E*Trade Invest Group investors that he lost their money 

due to poor market performance. 

7. By engaging in the conduct described in this Complaint, Defendant violated, and 

unless enjoined will continue to violate, Section 10(b) of the Securities Exchange Act of 1934 

(“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5] and 

Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. 

§§ 77(e)(a) and (c) and 77q(a)]. 

JURISDICTION AND VENUE 

8. The Commission brings this action pursuant to Sections 21(d) and 21(e) of the 

Exchange Act [15 U.S.C. §§ 78u(d) and (e)] and Sections 20(b) and 20(d) of the Securities Act 

[15 U.S.C. §§ 77t(b) and (d)] to permanently enjoin Defendant from engaging in such 

transactions, acts, practices, and courses of business alleged in this Complaint, and to obtain 

disgorgement, prejudgment interest, and civil money penalties, and such other and further relief 

as the Court may deem just and appropriate. 

9. This Court has jurisdiction over this action pursuant to Sections 21(d), 21(e), and 

27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa] and Sections 20(b), 20(d), and 

22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)].   

10. Venue in this District is proper pursuant to Section 27 of the Exchange Act 

[15 U.S.C. § 78aa] and 22(a) of the Securities Act [15 U.S.C. § 77v(a)].  Defendant is located, 

resides, and transacts business in the District of New Jersey.  Additionally, certain of the 

transactions, acts, practices, and courses of business constituting the violations alleged herein 

occurred within the District of New Jersey, and were effected, directly or indirectly, by making 

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use of the means or instruments or instrumentalities of transportation or communication in 

interstate commerce, or of the mails, or the facilities of a national securities exchange.   

DEFENDANT 

11. John A. DeSalvo, age 47, is a resident of Linwood, New Jersey.  He is the 

Founder and CEO of Blazar Token And The Moonfuel Protocol, LLC.  He is a former 

Lieutenant in the New Jersey Department of Corrections and is the owner of a parking lot 

sealcoating company.   

RELATED ENTITY AND INDIVIDUAL 

12. Blazar Token And The Moonfuel Protocol, LLC (“BTMP”), was incorporated 

in mid-May 2022 as a New Jersey limited liability company with a principal place of business in 

Marmora, New Jersey.  BTMP operated as DeSalvo’s alter ego in that DeSalvo controlled it.  

Neither the Blazar Token itself nor BTMP are, or were at any time, registered with the 

Commission in any capacity.  Nor were any offers or sales of the Blazar Token or BTMP 

registered with the Commission.   

13. Former Blazar Token Partner, age 36, is a resident of Williamstown, New 

Jersey.  From January 2022 to May 2022, he was a partner in connection with DeSalvo’s efforts 

to launch the Blazar Token.  He is a police officer in a New Jersey township.   

FACTS 

DeSalvo Offered and Sold the Blazar Token as Securities 

14. Starting in approximately November 2021, DeSalvo offered investors 

opportunities to profit from crypto-asset related investments in the Blazar Token. 

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15. All told, DeSalvo raised at least $623,888 from approximately 222 investors in 

connection with his offering of the Blazar Token.  DeSalvo accepted payment for Blazar Token 

investments in both cash and crypto assets.   

16. DeSalvo developed and pitched the Blazar Token as an alternative to state 

pension systems for police officers, fire personnel, and first responders.  In a Blazar Token 

“whitepaper,” which DeSalvo drafted to provide prospective investors with details about the 

project, DeSalvo wrote that investors would “transition out of the current pension system and 

into one of the future” by purchasing the Blazar Token.   

17. The whitepaper also described the Blazar Token as “the first token or coin that is 

able to be purchased through payroll deduction every week,” and stated that “it will be taken out 

of one’s weekly earnings pretax similar to payment into a pension, 401k, IRA or any other 

retirement savings plans.”   

18. DeSalvo primarily marketed and solicited prospective investors in the Blazar 

Token with a focus on law enforcement personnel through various online media, including in 

Facebook groups relating to law enforcement officer investing, Telegram, Stocktwits, multiple 

websites that he created for the project, and on his personal Facebook page.  DeSalvo also 

contacted prospective Blazar Token investors through direct phone calls and electronic messages 

to his network of contacts.   

19. DeSalvo also used paid press release distribution services to market the Blazar 

Token.  In one such press release dated December 5, 2021, entitled “Blazar Initial Token 

Offering is Already a Huge Hit,” DeSalvo wrote that “enthusiastic customers have lapped up the 

Blazar Token, making it one of the biggest token launches in recent times.”  

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20. In connection with his solicitation of Blazar Token investors, DeSalvo 

disseminated a contract that set forth, among other things, how Blazar Token’s management 

team would use investor funds.  Specifically, the contract stated that “proceeds from token sales 

during the ICO will be used for the development of the token, gas fees, advertising, marketing, 

exchange listing fees, and liquidity.”   

21. The contract also stated that “there will be absolutely no use of Blazar Token’s 

funds for the self-interest of any Member of Blazar Token’s management team.”   

22. Initially, DeSalvo was solely responsible for launching the Blazar Token.  

DeSalvo’s responsibilities included developing Blazar Token’s whitepaper, creating marketing 

materials, generating “buzz” on social media, and soliciting investors.   

23. In January 2022, in exchange for an investment of approximately $25,000, 

DeSalvo brought on Former Blazar Token Partner, a New Jersey police officer, as a partner in 

the development of the Blazar Token.  Former Blazar Token Partner reported to DeSalvo, and 

was primarily responsible for assisting in the solicitation of investors and overseeing the 

software developers hired to build and code Blazar Token’s smart contract.   

24. Despite Former Blazar Token Partner’s role as partner and his involvement in the 

day-to-day operations of developing the Blazar Token, DeSalvo retained full control over all 

Blazar Token-related decision making.  For example, only DeSalvo had access to the bank 

accounts and crypto asset wallets where investor funds were deposited and was responsible for 

all decisions regarding the use of investor funds.  

25. DeSalvo launched Blazar Token’s ICO in early November 2021.  Most ICO 

purchasers received “placeholder tokens” initially, during the development, and prior to the 

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actual launch, of the Blazar Token, but those placeholders were replaced by actual Blazar Tokens 

in April 2022.   

26. On April 21, 2022, the Blazar Token was first offered for trading on the crypto 

asset trading platform PancakeSwap.   

27. Investments in the Blazar Token were investments in a common enterprise.  

28. DeSalvo commingled both the cash and crypto asset investments that he received 

from Blazar Token investors with his personal funds in personal accounts held in his name. 

29. DeSalvo purported to use funds received from Blazar Token investors to fund and 

develop the marketing of the Blazar Token. 

30. DeSalvo pitched the Blazar Token as an investment opportunity and boasted that 

investors in the Blazar Token would receive substantial profits from their investments based on 

the appreciation in its price.   

31. Had the Blazar Token appreciated in value and been successful as an investment 

opportunity, investors would have reasonably expected to share in that success equally through 

an increase in the value of their respective Blazar Tokens. 

32. Based upon DeSalvo’s public statements as further set forth below, investors had 

a reasonable expectation of profits to be derived from DeSalvo’s efforts.  The profits of the 

Blazar Token investors were to be the result of DeSalvo’s efforts to procure additional 

investments, including as a result of automatic payroll deductions.  In particular, DeSalvo 

claimed that increases in the Blazar Token’s future trading price would be directly linked to his 

ability to register a large number of payroll deduction “accounts.”   

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33. DeSalvo offered to sell, and in fact sold, Blazar Tokens in a general solicitation 

through the mails or use of means or instruments of transportation or communication in interstate 

commerce. 

34. DeSalvo offered and sold Blazar Tokens to investors living in at least 11 states 

through multiple channels, including Facebook, telephone, and email, while there was no 

registration statement filed or in effect as to the Blazar Token offering. 

35. DeSalvo did not take reasonable steps to verify the accreditation status of the 

investors in the Blazar Token, and at least some of the investors in the Blazar Token were not 

accredited. 

DeSalvo Made False and Misleading Statements 
and Omissions about the Blazar Token 

 
36. DeSalvo made numerous false and misleading statements and omissions about the 

Blazar Token, including that:  (1) the Blazar Token was registered with the Commission; 

(2) DeSalvo had arranged for Blazar Tokens to be purchased through automated payroll 

deductions; and (3) the Blazar Token was guaranteed to provide exorbitant returns.  

DeSalvo Falsely Claimed that the Blazar Token Was Registered With the Commission 
 

37. Beginning in at least November 2021 and continuing through April 2022, in press 

releases, phone calls, and Facebook posts, DeSalvo told investors that he had registered the 

Blazar Token with the Commission.   

38. For example, in a December 2021 private Facebook message to an investor who 

questioned whether the Blazar Token was registered as a security, DeSalvo wrote, “With the 

SEC yes.  We are the FIRST EVER!!!”  

39. In a January 2022 Stocktwits post promoting the Blazar Token ICO, DeSalvo 

wrote, “we became a securitized token with the SEC.”   

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40. Additionally, in April 2022, in response to a prospective investor who would not 

invest if the Blazar Token were not “SEC registered,” DeSalvo replied, “I’ve been designated a 

securitized token by the SEC already.”   

41. During the same period, and despite having told certain investors that the SEC 

registration was finalized, DeSalvo authored at least four press releases that stated he was in the 

process of applying to the Commission to have the Blazar Token designated a “securitized 

token.”   

42. DeSalvo later sought ideas for how to frame the Blazar Token as a so-called 

“utility” token in an apparent attempt to avoid regulatory oversight.   

43. In a private voice message, DeSalvo stated “Blazar is sure as hell a security token 

. . . we want to come up with some bullshit that says it’s doing something not to do with money.” 

44. For at least some of the investors in the Blazar Token, Blazar Token’s purported 

registration with the Commission was one of the primary reasons they felt comfortable investing 

with DeSalvo, as it added a sense of legitimacy to the ICO.   

45. In reality, the Blazar Token was not registered with the Commission, nor had the 

Blazar Token submitted any draft (or other) registration statements to the Commission, nor were 

any registration statements filed or in effect as to any offer or sale of Blazar Tokens.  DeSalvo 

knew, or was reckless in not knowing, these facts. 

DeSalvo Falsely Claimed that He Had Arranged for the Blazar 
Token to be Purchased Through Automated Payroll Deduction 

 
46. DeSalvo pitched the Blazar Token to investors as a “pension supplement” and 

claimed it was designed to allow investors to purchase Blazar Tokens through automatic payroll 

deduction.    

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47. DeSalvo referred to this feature as a “crypto first” and claimed that increases in 

the Blazar Token’s future trading price would be directly linked to his ability to register a large 

number of payroll deduction “accounts.”   

48. As he communicated to investors, DeSalvo’s investment pitch was that the steady 

stream of weekly purchases via payroll deduction would increase the demand for the Blazar 

Token and, in turn, its trading price.  Without automated payroll deduction, however, there 

would be significantly less demand for the Blazar Token, which would have a negative impact 

on its price.   

49. In his first post on the Facebook All [Law Enforcement Officer] Crypto Group in 

November 2021, DeSalvo wrote:  “We have already secured being listed as a Payroll Deduction 

in 11 states.”   

50. In the next several weeks, DeSalvo wrote in at least three press releases that 

investors were able to purchase Blazar Tokens through payroll deductions.   

51. In April 2022, in a Telegram post to the Blazar Token investor community, he 

claimed that the Blazar Token was the “1st token ever to have over 25,000 ACH accounts ready 

to go for weekly deductions!”   

52. These statements were important to many of the Blazar Token investors when 

determining whether or not to purchase the Blazar Token.  

53. DeSalvo’s statements to Blazar Token’s investors and prospective investors about 

the availability of an automated payroll deduction to purchase the Blazar Token were false or 

misleading, as demonstrated by DeSalvo’s own statements in texts and private Facebook 

messages.   

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54. In March 2022, DeSalvo texted one of his developers:  “[Former Blazar Token 

Partner] and I need to contact a lot of places to try to get payroll/ACH rolling.”   

55. In April 2022, DeSalvo told a Blazar Token investor:  “[W]hat I really need to 

figure out is a company that will allow us to have ACH,” and messaged another investor:  

“[W]hat we need bro is ACH. I can’t find anyone to take it.”   

DeSalvo Falsely Guaranteed Exorbitant Blazar Token Returns 

56. DeSalvo falsely guaranteed that Blazar Token investors would receive exorbitant 

returns on their investments.   

57. Among other guarantees, DeSalvo promised at least one investor that the price 

would appreciate 300% when trading commenced on PancakeSwap, such that their $25,000 

investment would yield income of $100,000 per month and would be worth $1 million within 

one year.   

58. DeSalvo falsely promised a number of other investors that he would pay their 

money back if the value of Blazar Tokens depreciated.   

59. DeSalvo also made other false and outlandish return guarantees to prospective 

investors in writing, including:  

a) “This is a GUARANTEED MINIMUM 100X Your money”; 

b) “What if I told you BLAZAR Token can get you 22.1% GUARANTEED 

and it's not a lie?  Well we can … 22% GUARANTEED with ZERO 

risk”; and 

c) “This is no longer a maybe, it’s as solid as solid gets with the highest 

average annual return EVER seen on large sums of money.  To be able to 

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guarantee someone 20%+ on BILLIONS of dollars has NEVER been seen 

EVER.  Well that’s about to.” 

60. DeSalvo made these statements concerning the guaranteed investment returns on 

the Blazar Token without any reasonable basis to believe they were true.   

61. DeSalvo’s public statements concerning the lofty returns omitted any language 

concerning the risks associated with investing in ICOs, crypto assets, or securities more broadly. 

DeSalvo Misappropriated Blazar Token Investor Funds and Used 
Investor Funds in a Manner Inconsistent With Statements to Investors 

62. Of the at least $623,888 that DeSalvo raised in the Blazar Token offering, the 

majority of it was deposited into DeSalvo’s personal bank account or one of several crypto asset 

wallets under his control.  As a result, DeSalvo had access to the Blazar Token investor proceeds 

and exclusive control over how such funds were used.   

63. Although DeSalvo told investors that their funds would be used solely for 

development of the Blazar Token, and for gas fees, advertising, marketing, “exchange listing 

fees,” and liquidity associated with it, DeSalvo misappropriated investor funds and used investor 

proceeds in a manner inconsistent with his disclosures to investors. 

64. First, DeSalvo used investor funds for his personal expenditures.  

65. Between November 2021 and May 2022, nearly $267,000 in investor cash was 

routed through DeSalvo’s personal bank account.   

66. DeSalvo misappropriated approximately $54,000 of investor funds in order to pay 

for his personal expenditures and cash withdrawals.   

67. Second, DeSalvo misappropriated ether (“ETH”) received from investors, as well 

as ETH purchased with investor funds.   

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68. Between November 2021 and May 2022, DeSalvo accumulated more than 14 

ETH received from Blazar Token investors or purchased with investor funds, which at the time 

was worth more than $47,000.   

69. On August 30, 2022, after Blazar had collapsed, and without investor knowledge 

or approval, DeSalvo sold all of his ETH and transferred the proceeds to his personal bank 

account.  DeSalvo then transferred a portion of such funds to personal brokerage accounts and 

spent the rest on personal expenses.   

70. Third, DeSalvo regularly sent Blazar Token investor funds to his personal crypto 

asset wallets, where he speculated in other, more volatile crypto assets. 

71. For example, in May 2022, an investor transferred 1.07 bitcoin (“BTC”) valued at 

more than $41,000 to a DeSalvo-controlled crypto asset wallet as a means to fund a Blazar 

Token purchase.  The following day, DeSalvo sold 1.07 BTC for $41,090 and used the proceeds 

to purchase nearly 11,000 Kyber Network Crystal (“KNC”) tokens.   

72. Over the next week, KNC’s trading price plummeted and, by mid-May, DeSalvo 

had sold nearly all of the KNC that he purchased using investor funds and realized losses of 

more than $18,500—approximately 45%—of the investor’s funds, which were supposed to be 

used to fund the development of the Blazar Token.  

73. Fourth, DeSalvo used investor funds to repay an investor who threatened legal 

action against him.   

74. In May 2022, many investors noted the precipitous decline in the price of the 

Blazar Token from its early trading levels and confronted DeSalvo to determine the reasons for 

its poor performance.   

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75. Rather than tell his investors the truth—that the price decline was largely the 

result of his substantial selling of his own Blazar Tokens—DeSalvo lied and claimed it was 

Former Blazar Token Partner who had sold a large number of Blazar Tokens, and that he had 

fired Former Blazar Token Partner and was considering legal action.   

76. To placate an investor who threatened to sue, DeSalvo repaid him with tether 

(USDT) valued at $21,353, using previously raised funds from another investor.   

77. This was the only time any of the ICO investors received any money back from 

DeSalvo for their investment. 

DeSalvo Made Money to the Detriment of the Other Investors in the Blazar  
Token by Selling a Large Quantity of his Blazar Tokens During the Lock-Up Period 

78. The Blazar Token ICO concluded on April 21, 2022, when the Blazar Token was 

made available for trading on PancakeSwap. 

79. Pursuant to the terms of the contract drafted by DeSalvo, and provided to at least 

some investors, however, investors in the Blazar Token ICO were prohibited from selling their 

Blazar Tokens for a ninety-day window after the ICO.  The contract also stated that the 

“founders tokens” owned by DeSalvo could not be sold for six months post-ICO.  The Blazar 

Token whitepaper represented to investors and prospective investors that DeSalvo had an even 

longer lock-up period that prevented him from selling for one year. 

80. Notwithstanding these promised limitations, between May 11 and May 22, 

2022—during the lock-up period in which DeSalvo had represented that he would not sell his 

“founders tokens”—DeSalvo sold more than 41 billion Blazar Tokens (which included his 

“founders tokens”) on PancakeSwap.  This represented substantially all of the Blazar Tokens that 

DeSalvo controlled and was worth the equivalent of $51,000.   

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81. DeSalvo’s massive sales volume had a dramatic negative impact on Blazar 

Token’s trading price—resulting ultimately in the collapse of the price of the Blazar Token—

and, consequently, investors suffered significant losses on their investments.   

82. For example, a Blazar Token investment that was worth approximately $1,000 

prior to DeSalvo’s first sales on May 11 was only worth approximately $0.41 after DeSalvo’s 

sales on May 22.   

83. DeSalvo received all of the funds from his Blazar Token sales into one of his 

personal crypto asset wallets.   

84. The Blazar Token price never recovered following its collapse after DeSalvo’s 

sales, and the large majority of Blazar Token purchasers are left holding these nearly worthless 

crypto asset securities. 

85. DeSalvo knew, or was reckless in not knowing, (1) that he had represented that he 

would not sell his “founders tokens” during this time period; and (2) the likely adverse effect that 

his sales activity would have on the price of the Blazar Token.   

The E*Trade Investment Group Fraud 
 

86. Prior to his Blazar Token scheme, beginning in late January 2021, DeSalvo 

engaged in a securities investment fraud scheme in connection with what he called the “E*Trade 

Invest Group.”   

87. On January 19, 2021, DeSalvo opened an E*Trade brokerage account in his own 

name.  DeSalvo established no legal entity for the investment group. 

88. Prior to receiving funds from any investment group participants, the account was 

valued at $380.   

 

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DeSalvo Solicited Investors to Participate in an Investment Group 

89. DeSalvo primarily solicited investors for the “E*Trade Invest Group” on his 

personal Facebook page, telling them that he was seeking to raise a total of $100,000 from 20 

people.  In a Facebook post, DeSalvo also provided instructions on how to transfer funds directly 

into his E*Trade brokerage account.   

90. In emails to investors, DeSalvo explained that he would invest their funds in 

various securities, including options, stocks, and crypto assets.   

91. Between February 3 and February 10, 2021, 17 investors sent DeSalvo a total of 

$95,000 to participate in the investment group.  Other than the initial $380, DeSalvo did not put 

any additional personal funds into the account.   

92. DeSalvo told investors that their money would grow significantly because of his 

investment expertise.   

93. In an email to investors, DeSalvo stated, “I have been averaging close to 1200% 

over the last 2 years.  I am in the top 1,000th percent in the world.”   

94. In a private Facebook message to an investor, DeSalvo stated, “I’ve done this 

three times since the summer.  I’m not guaranteeing we get the same results, but so far the other 

three accounts are all over one-half million and they started with over $25,000….”   

95. His pitch was simple:  because of his purported track record investing, all the 

investors needed to do was, as he put it in one Facebook post, “sit back and relax and get rich.” 

96. DeSalvo told investors that his goal for the fund was to turn the $100,000 initial 

investment pool into $1 million by the end of the summer.   

97. These statements were false and misleading. 

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98. Contrary to his representations, DeSalvo was not averaging close to 1,200 percent 

on his investments over the last two years, nor did he otherwise have the investment track record 

that he claimed to have.   

99. DeSalvo also did not invest the funds raised for the investment group’s benefit. 

DeSalvo Misappropriated Investor Funds for His Own Personal Benefit 
 

100. DeSalvo initially purchased securities in his E*Trade brokerage account that he 

had opened in January 2021 in a manner consistent with his statements to investors.   

101. In early February 2021, DeSalvo primarily purchased highly speculative, near-

expiration call options as well as equity securities.   

102. In the first week, the investments performed well, rising in value to over 

$140,000.  DeSalvo also sent the investors near daily emails with general comments on holdings 

and daily performance.   

103. However, beginning on February 10, 2021, and continuing over the next trading 

week, the investment group’s holdings lost nearly 50% of their value from their prior highs.   

104. By February 18, 2021, the group’s holdings were only worth approximately 

$77,000.   

105. As the account’s value began to decline, DeSalvo stopped sending emails to his 

investors. 

106. As the investment group’s holdings lost value, DeSalvo also began transferring 

funds out of his E*Trade brokerage account for his own personal benefit.   

107. On February 11, 2021, DeSalvo transferred $4,656 from the brokerage account to 

one of his personal bank accounts to pay credit card bills and to withdraw cash from an ATM.   

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108. Between February 19 and February 24, 2021, DeSalvo liquidated the remaining 

positions and transferred the funds—more than $78,000—to his personal bank account.   

109. On February 24, 2021, in a private Facebook message, after draining the 

brokerage account, DeSalvo told one investor: “We’re done. Biggest crash of the Nasdaq in 27 

years. . . . 11 of 13 days down in a row.”  

110. Of the over $82,000 that he misappropriated from his investors, DeSalvo: 

(1) transferred over $56,000 to one of his personal crypto wallets; (2) issued a $10,000 check to a 

contractor who was in the process of renovating his bathroom; and (3) transferred more than 

$6,000 to a brokerage account in the name of his daughter.   

111. In his crypto asset wallet, DeSalvo traded various speculative and volatile crypto 

assets and made frequent transfers both to and from his other crypto asset wallets, his personal 

bank account, and his brokerage accounts.   

112. In sum, DeSalvo looted the group’s brokerage account, and it ended February 

2021 with a zero balance.  DeSalvo kept the majority of their money for himself and returned 

none of it to his investors. 

DeSalvo Lied to Investors to Conceal His Misconduct 
 

113. In mid-May 2021, DeSalvo resumed sending emails to the investment group.   

114. DeSalvo apologized to the group, claiming that he was “just notified” that no one 

had received any of the 77 emails he had purportedly sent to the group since February, 

notwithstanding the fact that an investor had emailed him more than two months earlier asking 

why he had stopped communicating with them. 

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115. DeSalvo falsely told his investors that the account had suffered significant losses 

due to the White House’s infrastructure plans and that the account ended February with around 

$27,000.   

116. Subsequent emails from DeSalvo continued to claim that he lost their money due 

to poor market performance.  DeSalvo did not disclose to the investors his misappropriation of 

their funds.   

Defendant Violated the Securities Laws 
 

117. The investments in the Blazar Token offered and sold by Defendant were 

securities within the meaning of the Securities Act and Exchange Act.  The investments to be 

purchased or sold by Defendant in connection with the E*Trade Invest Group also were 

securities within the meaning of the Securities Act and Exchange Act. 

118. An investment contract (a type of security) exists when individuals or entities:  

(a) invest money or otherwise exchange value (including dollars, crypto assets, and other 

consideration such as labor); (b) in a common enterprise; (c) with a reasonable expectation of 

profits to be derived from the entrepreneurial and managerial efforts of others. 

119. Blazar Token investors provided DeSalvo with money or otherwise exchanged 

value in connection with their investments. 

120. The investments in the Blazar Token were all in a common enterprise.  Investors 

played no role in the management or operations of the businesses of the Blazar Token. 

121. Defendant repeatedly told investors that the value of the Blazar Token would 

significantly increase based upon Defendant’s efforts.  Blazar Token investors expected profits 

to be derived from DeSalvo’s efforts.  

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122. Neither the Blazar Token itself, nor BTMP, are, or were at any time, registered 

with the Commission in any capacity.  Nor were any registration statements filed or in effect as 

to any offer or sale of Blazar Tokens or BTMP.   

123. Defendant’s offer and sale of the Blazar Token was a general solicitation through 

the mails or use of means or instruments of transportation or communication in interstate 

commerce. 

124. Through multiple channels, including Facebook, telephone, and email, DeSalvo 

offered and sold Blazar Tokens to investors living in at least 11 states. 

125. At least some of the investors in the Blazar Token were not accredited and, in any 

event, DeSalvo did not take reasonable steps to verify the accreditation status of the investors. 

126. DeSalvo engaged in the offer and sale of the securities of the Blazar Token by use 

of the means or instruments of transportation or communication in interstate commerce, the 

instrumentalities of interstate commerce, and/or by use of the mails.  

127. Directly or indirectly, DeSalvo made materially false and misleading statements 

and omissions to Blazar Token investors and prospective investors concerning, among other 

things:  (1) whether the Blazar Token (or its offer/sale) was registered with the Commission; (2) 

whether DeSalvo had arranged for the Blazar Token to be purchased through automated payroll 

deductions; (3) whether the Blazar Token was guaranteed to provide exorbitant returns; and (4) 

DeSalvo’s use of investor funds.  Defendant, directly or indirectly, knowingly or recklessly made 

such material untrue statements and omitted to state material facts necessary in order to make the 

statements made, in light of the circumstances under which they were made, not misleading. 

128. Directly or indirectly, DeSalvo made materially false and misleading statements 

and omissions to E*Trade Invest Group investors and prospective investors concerning:  (1) his 

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prior returns from other investment groups; and (2) DeSalvo’s use of investor funds.  Defendant, 

directly or indirectly, knowingly or recklessly made such material untrue statements and omitted 

to state material facts necessary in order to make the statements made, in light of the 

circumstances under which they were made, not misleading. 

129. A reasonable investor would consider the misrepresented facts and omitted 

information described herein important in deciding whether or not to invest. 

130. The untrue statements of material fact and material omissions described herein 

were made in the offer or sale and/or in connection with the purchase or sale of securities. 

131. In connection with the conduct described herein, Defendant acted knowingly or 

recklessly.  Defendant knew or was reckless in not knowing that Defendant was making material 

misrepresentations and omitting to state material facts necessary to make certain statements not 

misleading under the circumstances. 

FIRST CLAIM FOR RELIEF 
 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder 
 

132. The Commission re-alleges and incorporates by reference each and every 

allegation in paragraphs 1 through 131, inclusive, as if they were fully set forth herein. 

133. By engaging in the conduct described above in connection with the Blazar Token 

and E*Trade Invest Group, Defendant, knowingly or recklessly, in connection with the purchase 

or sale of securities, directly or indirectly, by use the means or instrumentalities of interstate 

commerce, or the mails, or the facilities of a national securities exchange: 

a) employed devices, schemes or artifices to defraud; 

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b) made untrue statements of material facts or omitted to state material facts 

necessary in order to make the statements made, in light of the 

circumstances under which they were made, not misleading; and/or  

c) engaged in acts, practices, or courses of business which operated or would 

operate as a fraud or deceit upon any person in connection with the 

purchase or sale of any security. 

134. By engaging in the foregoing conduct, Defendant violated, and unless enjoined 

will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 

[17 C.F.R. § 240.10b-5], thereunder.   

SECOND CLAIM FOR RELIEF 
 

Violations of Section 17(a) of the Securities Act 
 

135. The Commission re-alleges and incorporates by reference each and every 

allegation in paragraphs 1 through 131, inclusive, as if they were fully set forth herein.  

136. By engaging in the conduct described above in connection with the Blazar Token, 

Defendant knowingly or recklessly, in the offer or sale of securities, directly or indirectly, by the 

use of means or instruments of transportation or communication in interstate commerce or by use 

of the mails:   

a) employed devices, schemes, or artifices to defraud; 

b) obtained money or property by means of untrue statements of material fact 

or omissions to state material facts necessary in order to make the 

statements made, in light of the circumstances under which they were 

made, not misleading; and/or 

c) engaged in transactions, practices, or courses of business which operated 

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or would operate as a fraud or deceit upon purchasers of securities.  

137. By engaging in the foregoing conduct, Defendant violated, and unless enjoined 

will continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 

THIRD CLAIM FOR RELIEF 
 

Violations of Section 5(a) and (c) of the Securities Act 

138. The Commission re-alleges and incorporates by reference each and every 

allegation in paragraphs 1 through 131, inclusive, as if they were fully set forth herein.  

139. By engaging in the conduct described above in connection with the Blazar Token, 

Defendant, directly or indirectly: 

a) made use of the means or instruments of transportation or communication 

in interstate commerce or of the mails to sell, through the use of medium 

of any prospectus or otherwise, securities as to which no registration 

statement was in effect;  

b) for the purpose of sale or delivery after sale, carried or caused to be 

carried through the mails or in interstate commerce, by means or 

instruments of transportation, securities as to which no registration 

statement was in effect; and/or 

c) made use of means or instruments of transportation or communication in 

interstate commerce or of the mails to offer to sell, through the use or 

medium of any prospectus or otherwise, securities as to which no 

registration statement had been filed. 

140. By engaging in the foregoing conduct, Defendant violated, and unless enjoined 

will continue to violate, Sections 5(a) and (c) of the Securities Act [15 U.S.C. §§ 77e(a) and (c)]. 

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PRAYER FOR RELIEF 

 WHEREFORE, the Commission respectfully requests that the Court enter a final 

judgment: 

I. 

 Permanently restraining and enjoining Defendant DeSalvo from, directly or indirectly, 

violating Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 

C.F.R. § 240.10b-5], and Sections 5(a), 5(c), and 17(a) of the Securities Act [15 U.S.C. §§ 

77(e)(a) and (c) and 77q(a)]; 

II. 

Permanently restraining and enjoining Defendant DeSalvo from, directly or indirectly, 

including, but not limited to, through any entity he owns or controls, participating in the 

issuance, offer, or sale of any security, including any crypto asset security; provided, however, 

that such injunction shall not prevent him from purchasing or selling securities for his own 

personal accounts; 

III. 

Ordering Defendant DeSalvo to disgorge ill-gotten gains as a result of the violations 

alleged herein, together with prejudgment interest thereon, pursuant to Exchange Act Sections 

21(d)(3), 21(d)(5) and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), 78u(d)(5), and 78u(d)(7)]; 

IV. 

 Ordering Defendant DeSalvo to pay civil penalties pursuant to Section 21(d)(3) of the 

Exchange Act [15 U.S.C. § 78u(d)(3)] and Section 20(d) of the Securities Act [15 U.S.C. § 

77t(d)] for violations of the federal securities laws as alleged herein; and  

 

 

 

 

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V. 

Granting such other and further relief as this Court may deem just and proper. 

 

 
Dated:  August 23, 2023          Respectfully submitted, 

   
BY: ______________________           

Christopher R. Kelly 
 Gregory R. Bockin  

Philadelphia Regional Office 
One Penn Center 
1617 JFK Blvd., Suite 520 
Philadelphia, PA  19103 
Telephone: (215) 597-3100 
Facsimile: (215) 597-2740 
[email protected] 
[email protected] 
Attorneys for Plaintiff 
SECURITIES AND EXCHANGE 
COMMISSION  
 

Of Counsel: 
  

Assunta Vivolo 
Brian P. Thomas 
David W. Snyder 
 

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