Online sweepstakes operator in Las Vegas accused of perpetrating a $9 million fraudulent scheme
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In a shocking turn of events, Robert Alexander, a former video games industry executive, has been accused of fraudulently raising millions of dollars from investors for his online gaming company, Kizzang. The Las Vegas-based company, known for its "Final 3" and "April Madness" promotions, was insolvent by December 2017.
According to the Securities and Exchange Commission (SEC), Alexander fraudulently raised $9 million from more than 50 individuals for Kizzang. The funds were supposed to be used to monetize consumer traffic through advertising and sponsorship, but the company never had any meaningful source of revenue from its incorporation in 2014 to its 2017 insolvency.
Alexander, who once sat on the board of Take-Two Interactive, the parent company of Rockstar Games, is accused of stealing at least $1.3 million from investors. He made wild claims to investors, promising a tenfold return on their investments and claiming he had personally invested millions into the business and had been involved in the creation of an unnamed hit video game.
However, between May 1 and May 26, 2015, Alexander spent more than $20,000 of investor funds on a gambling spree at four different casinos in Las Vegas and Indiana. More than $450,000 of the stolen money was used by Alexander to fuel his gambling habit. Carolyn Welshhans, Associate Director in the SEC's Division of Enforcement, stated that Alexander used investor proceeds for personal use.
The online gaming company Kizzang was sued by the NCCA in 2017 for copyright infringement over its "Final 3" and "April Madness" promotions. Kizzang was also sued by Sports Illustrated for a $1 million marketing partnership, with Sports Illustrated being awarded a default judgment of $1,025,384.62.
Alexander failed to appear in court for both the NCCA lawsuit and the Sports Illustrated lawsuit. The NCCA was awarded a default judgment against Kizzang. Alexander has been arrested and charged with fraud, but his current status is that he has passed away. His fraud suit was dropped by the SEC following his death in October 2024. At the time of his death, it was reported to the SEC that he was destitute.
Despite his involvement in Kizzang, it is not specified in the search results that Alexander had any connection with Take-Two Interactive in the context of the fraud allegations against him. Rockstar Games, a subsidiary of Take-Two Interactive, is known for creating the Grand Theft Auto and Red Dead series.
[1] Source: SEC Filing
In the midst of the fraud accusations, it was revealed that Robert Alexander, the ex-executive of Kizzang, a casino-and-gambling based company in Las Vegas, spent over $20,000 of investor funds on casino-games in multiple casinos, highlighting a stark contradiction with the company's intended use of the funds. Despite his connections with Take-Two Interactive in a past capacity, Alexander's fraudulent activities appeared to have no connection with the creation of video games from this company, such as the Grand Theft Auto and Red Dead series.
