The U.S. Division of Justice (DOJ) is charging two California males for allegedly masterminding a multimillion-dollar non-fungible token (NFT) funding rip-off.
In a brand new press launch, the DOJ says it’s charging 23-year-olds Gabriel Hay of Beverly Hills and Gavin Mayo of Thousand Oaks with conspiracy and wire fraud expenses after they had been accused of pulling a number of crypto rug pull scams involving NFTs.
Rug pull scams are when creators of a brand new asset deliberately inflate its worth earlier than promoting their stashes, inflicting the asset to plummet in worth and leaving buyers holding the bag.
Based on courtroom paperwork, between Might 2021 and Might 2024, the duo promoted a number of altcoin and NFT tasks and allegedly made or triggered others to make false statements in regards to the tasks, similar to once they would launch.
One instance offered by the DOJ outlines how they allegedly promoted the Vault of Gems NFT challenge, which they falsely claimed was the “first NFT challenge to be pegged to a tough asset.”
Nevertheless, they deserted the challenge after getting tens of millions of {dollars} of funds from buyers. Different tasks the duo was concerned in embrace Faceless, Sinful Souls, Clout Coin, Soiled Canine, Uncovered, MoonPortal, Squiggles, and Roost Coin.
To keep away from detection, Hay and Mayo would allegedly lie about being behind the tasks and instruct others to do the identical, based on the press launch.
As acknowledged by Homeland Safety Investigations (HSI) Government Affiliate Director Katrina W. Berger,
“For 3 years, Hay and Mayo allegedly lied to their buyers with a purpose to defraud them out of tens of millions of {dollars}. Such technological fraud schemes price buyers tens of millions of {dollars} yearly.
Simply because such crimes aren’t violent doesn’t imply they’re victimless. HSI will proceed to analyze, disrupt, and dismantle such cryptocurrency fraud networks.”
Hay and Mayo are additionally charged with stalking for allegedly embarking on a harassment marketing campaign in opposition to a developer who uncovered that they had been behind one of many crypto tasks.
If convicted of all counts, they face jail sentences of as much as 25 years.
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