Three British nationals linked to a non-fungible “carpet pulling” scam have been charged in the United States with conspiracy to commit wire fraud and money laundering.
The defendants, Mohamed Amin Atcha, Mohamed Relaz Waleed and Dawoud Hassan, allegedly raised the prices of 10,000 NFTs based on false promises that they would develop a video game before transferring the funds abroad and abandoning the project , the US Attorney’s Office said in the statement. WE. The Southern District of New York said in a June 6 statement.
“Digital art may be new, but the old rules are still old Enforcement: Making false promises in exchange for money is illegal (…) NFT fraud is not a game, and those responsible will be held accountable,” reiterated US Attorney Damien Williams.
FBI Deputy Director James Smith added: “Hiding customers without fulfilling a promise not only reflects poor business integrity, but also violates the implicit trust that buyers place in sellers when purchasing a product. »
In total, nearly 800 Ethereum (ETH) – worth $2.7 million at the time – was allegedly stolen during the withdrawal.
“They would have taken investors’ money, never developed the game and pocketed the profits,” Williams said.
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Acha, Walid, and Hassan received more than $2 million from Evolved Ape NFT sales on day one, which the U.S. Attorney’s Office says occurred on September 24, 2021 – the middle of “summer NFT”.
The U.S. Attorney claimed that its website included “road map” subsections and phases to make the NFT project appear legitimate. “Phase Five” claimed that Evolved Apes would release a fighting game accessible only to Evolved Ape NFT holders.
But the Evolved Apes website was shut down less than two weeks later on October 5, 2021, leaving investors stranded.
Interestingly, Walid transferred the stolen funds to a personal wallet address, but the cryptocurrency exchange blocked him from withdrawing the funds.
She initially planned to “investigate the source” of the funds, but the customer service team re-enabled the withdrawal feature after Waleed falsely stated he needed the funds to pay for cancer treatment from his grandmother, according to the U.S. Attorney’s Office.
The U.S. Attorney’s Office wants the three defendants to lose $875,850 in Tether (USDT) held at the wallet address “0x519…6ed70.”
Conspiracy to commit wire fraud and money laundering each carry a maximum sentence of 20 years in prison in New York.
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