French citizens and expatriates living in the United Arab Emirates face fraud charges in the US over alleged counterfeiting of a popular ape-themed non-fungible token (NFT) project, federal prosecutors say. announced Thursday.
Aurelian Michel24 years old, charged wire fraud in a criminal complaint opened Thursday.
The defendant was arrested Wednesday night at John F. Kennedy International Airport, according to a press release issued by the US Attorney’s Office for the Eastern District of New York.
The 16-page criminal complaint does not specifically charge Michelle with a federal court count tailored to his alleged conduct. It outlines a “lag-pull” scheme and alleges that the defendants “claim to be involved in the described fraudulent activity.” [therein] Earned fraudulent proceeds. “
NFTs are controversial, among the broader crypto community, the concept behind them is very simple. Each NFT is created by using a specific amount of money. Cryptocurrency By uploading an image file that represents the digital asset in question. Users also typically add identifying information to each NFT. Essentially, this process transforms a piece of digital art into a public record stored on a public blockchain. It is a list of public records that are cryptographically linked together and cannot be changed once created.
The most popular blockchain for NFT minting is the Ethereum network. And, according to federal law enforcement, it’s the blockchain that Michelle used in a scheme to deceive investors when he bought $3 million worth of “Mutant Ape Planet” NFTs.
According to the project’s website and official Discord chat affiliated with Mutant Ape Planet, NFT purchasers were promised a “community focus” that included an array of additional perks, the criminal complaint alleges.
According to the complaint, Michelle allegedly advertised the project as: Launch of a product collection featuring artwork. Release of another token related to the project for buyers that can be used to generate further investment returns in decentralized financial applications. How to promote raffles and giveaways within the community. And it promises that “developers will acquire virtual land in the metaverse and bring more benefits to NFT buyers.”
Instead, federal officials claim the defendants took the money and fled. This is called “rug pulling” in cryptographic parlance.
“The representations made on the MAP website and the MAP Discord were false,” the complaint alleges. “Purchasers of the Mutant Ape Planet NFT did not receive any of the promised perks. [by Michel]Instead, the Mutant Ape Planet NFT project was a ‘lag pull’, with some of the purchaser’s funds diverted to the benefit of the defendants. “
The filing alleges that Michelle used the pseudonym “James” in a Discord chat and eventually admitted to the fraud.
On or around June 4, 2022, “James | FOUNDER” posted a message to users on the MAP Discord channel, stating in the relevant part: We are aware that our actions have led to this…”
“Once the NFT sold out, Michelle shut down communications, withdrew buyer funds from the company’s cryptocurrency wallet, and is said to have filled pockets with nearly $3 million of investor money,” said IRS Deputy Special Representative. official Thomas Fat Russo said in a press release. “Michelle can no longer blame the NFT community for his criminal behavior. His arrest means he will face the consequences of his own actions.”
In a criminal complaint, federal officials have obtained Know Your Customer information from an unidentified cryptocurrency exchange whose accounts are allegedly linked to one of the cryptocurrency wallets used to drain the project’s financial resources. By using it, Michelle claims to have been determined to be the person known as “James.” .
“As alleged, defendants used traditional criminal schemes to defraud consumers eager to participate in new digital asset markets,” federal prosecutor said. bleon peace said in a press release. “Protection against fraud and manipulation extends to all consumers and investors, including those participating in the rapidly evolving market for NFTs and other crypto assets. We are committed to bringing criminals who misuse the market to justice.”
Read the Complaint and Affidavit Here.
[image via Eastern District of New York]
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