The DOJ filed charges against Baller Ape Club in a possible rug pull and annoucned three other fraud cases that amounted to $100 million in potential losses so let’s read more today in our cryptocurrency news.
The DOJ filed charges against the creator of the Baller Ape Club NFT collection for orchestrating a rug-pull. The charges announced alongside the other crypto fraud cases made the second time federal prosecutors went after NFT rug pull schemes where an NFT proejct creator sells NFTs on false promises of the community benefits and utility but then abandoned the project and makes off with the funds. The Vietnamese national Le Anh Traun is charged with a count of conspiracy to commit wire fraud and a count of conspiracy to commit international moeny laundering.
Traum collected $2.6 million from baller Ape NFT Buyers but then deleted the organization’s website and laundered the funds. As per the Justice Department, he converted the gains into different cryptocurrencies and moved them on multiple blockchains but if convicted, Traun could face up to 40 years in prison. NFT rug pulls are too familiar in the high volume where the new collections pop up from a slew of unheard creators. Last year alone, the NFT market generated $25 billion in sales but the DOJ didn’t prosecute a single NFT fraud case in 2021.
In March this year, the DOJ announced the first case against an NFT creator for defrauding buyers showing that the federal governemnt has a will to pursue these cases and today’s charges only confirm the appetite. US Attorney Tracy L. Wilkison said in a statement:
“These cases serve as a crucial reminder that some con artists hide behind trendy buzzwords, but at the end of the day, they are simply seeking to separate people from their money. We will continue to work with our law enforcement partners to educate and protect potential investors about both traditional and trendy investments.”
The Baller Ape Case as well as three others announced, are a product of national enforcement action that is led by the DOJ in conjunction with the FBI and the Department of Homeland Security. The other cases charged include an alleged crypto Ponzi scheme that raised $100 million, another fraudulent ICO that stole $21 million from investors, and a crypto commodities scheme that saw a 60% return of investment to investors using a fake team of armed security guards.