Fraud and NFT: US Justice Set to Dominate the Ring

The US Department of Justice just got its paws on the founder of the Mutant Ape Planet NFT collection. The latter would be behind a carpet pull that cost users nearly 2.9 million.

Founder of Mutant Ape Planet NFT Collection Arrested

Resolutely, the US Department of Justice wants to fight against fraudsters. His latest target is the founder of the Mutant Ape Planet collection, a spin-off of the very famous Mutant Ape Yatch Club NFT collection from Yuga Labs. Aurélien Michel, a French citizen, was arrested at John Fitzgerald Kennedy Airport in New York. Federal agents accuse him of setting up a carpet-tripping scheme where he allegedly extorted nearly 3 million of his users.

“Under this scheme, NFTs were traded to buyers who were falsely promised numerous benefits and rewards designed to increase demand and value for the NFTs they had just purchased.”

US Department of Justice – DD

Specifically, the latter would have promised buyers service tokens and other financial advantages, but after the sale of NFTs, it had already disappeared with the customers’ funds. Representatives of the United States Department of Justice say they have evidence that Michel deliberately orchestrated this carpet-pulling. The latter seems to point the finger at the behavior of members of the Mutant Ape Planet community.

“We never intended to leave, but the community has become too toxic.”

Excerpt from Michel’s conversation with a member of the Mutant Ape Planet community.

For American justice, Aurélien Michel cannot blame the buyers to justify his fraud.

“Aurélien Michel can no longer blame the NFT community for his criminal behavior. His arrest means he will now face the consequences of his actions.”

aThomas Fattorusso, IRS Special Agent in Charge.

Lots of rug pulling

According to data shared by DappRadar during the month of December, carpet pulling reportedly cost crypto users over $200 million. In this type of fraud, the creator of the project disappears after collecting funds from investors. The most well-known to date is still that of Sign of the squid game, a so-called project that would replicate the games of the extremely popular South Korean series. But in reality, the story ended up being an outright hoax.

Therefore, American justice has been very attentive to these schemes. In June, it blasted the founder of NFT collection Baller Ape Club for extorting $2.6 million from investors. Long before this case, the DOJ had convicted the founders of the Frostie NFT project for fraudulent activities.

Despite the staggering decline in NFT sales, fraudsters are not missing an opportunity to extort investors. Using the name of a famous collection seems to be a very popular way to extract money from users. For this, it is essential to do your research beforehandpour in in any NFT project or… any crypto project.

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