The US Justice Department reported that two men have been accused of tricking to submit wire extortion and illegal tax avoidance “regarding a 1,000,000 dollar plan to swindle buyers of NFTs publicized as Frosties.”
The suspects, Ethan Nguyen, and Andre Llacuna were blamed for lying about benefits vowed to NFTs purchasers and pulling out the digital money that continues out of the Frosties account through numerous exchanges.
Their genuine characters were revealed after specialists investigated the important record of exchanges forever put away on Ethereum’s blockchain and dissected the related exchanges to accounts on Coinbase.
$1.1 Million NFT Project Scam
As indicated by the criminal objection delivered by the court, on January 9, 2022, an aggregate of 8,888 Frosties tokens worth generally $1.1 million were sold out 48 minutes after the public deal had gone live. Each NFT went for 0.04 ETH, around then identical to around $130.
The complaint pointed out that approximately three hours after the sale, “the returns of the Frosties NFT deal that had been moved to Frosties Wallet Address-1 were then moved to a different digital currency wallet address (“Fraud Wallet Address-1″).” In absolute, 356.56 ETH was shipped off the “Extortion wallet address,” as later recognized by the examiners.
Additionally, as demonstrated by the DOJ’s public statement, Nguyen and Llacuna didn’t give benefits as advertised to the NFT purchasers and moved the digital currencies to wallets under their influence.
Suspects Behind The Scheme
IRS-CI Investigators matched Nguyen and Llacuna’s IP addresses utilized for advancing Frosties on Discord with relating accounts on Coinbase. The KYC prerequisites forced by the US trade to its clients permitted regulation requirements to sort out the characters of the record holders.
Specialists found the activities related to the misrepresentation wallet address and effectively distinguished moves directed between the Coinbase accounts and the extortion wallet connected to Frosties reserves.
Before Nguyen and Llacuna were captured in Los Angeles, they were getting ready to send off a subsequent NFT trick called “Coals.” It should go live around March 26, 2022, and create extra income of up to $1.5 million in computerized resources.
Accused of misrepresentation and tax evasion, Nguyen and Llacuna are viewed as the early mark of US regulation implementation sloping up its assets and apparatuses focusing on NFT carpet pulls.