Six people have been indicted in four separate cryptocurrency fraud cases involving losses of more than $130 million, U.S. federal prosecutors said this week, including the largest alleged NFT scam to date.
Prosecutors said the scheme involved a group called the Baller Ape Club, which claimed to sell NFTs featuring cartoon images of apes.
An organization with a similar theme: The Bored Ape Yacht Club, is one of the most popular NFT series in the world, with endorsements from Snoop Dogg, Tom Brady and other celebrities. Its NFTs have sold for hundreds of thousands of dollars each, although prices have dropped dramatically in recent weeks. Le Anh Tuan, 26, of Vietnam, was charged in California with conspiracy to commit wire fraud and conspiracy to commit international money laundering in connection with the Baller Ape Club scheme.
Shortly after Baller Ape Club went on public sale, Tuan and unnamed co-conspirators "co-opted" investors, removed the group's website and made off with $2.6 million, according to the U.S. Attorney's Office for the Central District of California. invest.
Prosecutors said Tuan and others laundered the money through cryptocurrencies and cryptocurrency services.
If convicted, Tuan faces up to 40 years in prison.
In a separate case, the founder and former CEO of Titanium Blockchain Infrastructure Services was charged with one count of securities fraud related to the company’s initial coin offering (new cryptocurrency projects generally use ICOs to raise funds, similar to in an initial public offering of company stock).
Federal prosecutors in California say Reseda's 54-year-old CEO, Michael Alan Stollery, forged documents sent to potential investors proving the purpose of the project and falsely claimed that his business had ties to the U.S. Federal Reserve and Apple , Disney and companies such as Pfizer are related.
The ICO project has raised approximately $21 million in funding from investors.
If convicted, Stollery faces up to 20 years in prison.
In a third case, a Las Vegas man was charged in California with four counts of wire fraud, as well as one count each of obstruction of justice, conspiracy to commit wire fraud and conspiracy to commit commodities fraud. count.
David Saffron, 49, used his cryptocurrency investment platform Circle Society to raise about $12 million from investors for a fraudulent cryptocurrency fund that claimed to trade in futures and commodities markets, prosecutors said.
Saffron allegedly told investors that he used a "trading bot" to generate returns of up to 600%. Prosecutors said he held investor meetings at his Hollywood Hills home and traveled with armed guards to "create the illusion of wealth and success." "In reality, Saffron was operating an illegal Ponzi scheme, defrauding victim investors and using the funds for his personal benefit," said Ryan L. Korner, Special Agent in Charge of the IRS's Los Angeles Office of Criminal Investigation.
If convicted, Saffron faces up to 115 years in prison.
The fourth case prosecutors announced this week was charged in the Southern District of Florida.
Emerson Pires and Flavio Goncalves of Brazil, and Joshua David Nicholas of Stuart, Florida, were each charged with one count of conspiracy to commit securities fraud and conspiracy to commit wire fraud in connection with the crypto Ponzi scheme, prosecutors said. Defrauded approximately $100 million from investors. Pires and Goncalves, 33, are also charged with conspiring to commit international money laundering.
Prosecutors said Pires and Goncalves, founders of the cryptocurrency investment platform EmpiresX, worked with Nicholas, the 28-year-old "chief trader," to promote the platform using false guarantees of returns for investors.
The U.S. Attorney's Office said: "Blockchain analysis revealed that Pires and Goncalves subsequently laundered investor funds through a foreign cryptocurrency exchange and paid out earlier investments with money obtained from later investors in EmpiresX. investors, running a Ponzi scheme."
If convicted, Nicholas faces up to 25 years in prison; Pires and Goncalves each face up to 45 years in prison.
