NFT Rug Pull Artist Behind MAYC Copycat Charged by US Authorities

A recent criminal complaint unsealed by US Federal Court in Brooklyn is among the first ever precedents for criminal investigation against creators of non-fungible tokens (NFTs).

NFT Developer Charged With Rying Move With $2.9 Million Stolen

According to a statement from the Eastern District of New York US Attorney’s Office, Aurelien Michel, a French citizen and resident of the UAE, was arrested for defrauding buyers of Mutant Ape Planet NFTs. The collection closely resembled the famous Mutant Ape Yacht Club by Yuga Labs, but had nothing in common with it.

Non-Fungible Token (NFT) Developer Charged in Multi-Million Dollar International Fraud Scheme

Buyers of “Mutant Ape Planet” NFTs were defrauded of $2.9 million

Advertised with @HSINewYork @IRSCI_NY

— US Attorney EDNY (@EDNYnews) 5 January 2023

Michel has already appeared before U.S. Magistrate James R. Cho. The NFT artist created and distributed a collection of tokens that were equipped with falsely promoted tools, rewards and bonuses. However, he “pulled the curtain” and withdrew $2.9 million from investors’ deposits.

As buyers were left with “worthless” tokens, Michel allegedly used all the money for his own benefit.

Breon Peace, United States Attorney for the Eastern District of New York, admitted that this scheme is unfortunately not unique: many investors were defrauded in a rather similar way:

As alleged, the defendants used a traditional criminal scheme to defraud consumers eager to participate in a new market for digital assets. Protection against fraud and manipulation covers all consumers and investors, including those participating in the rapidly evolving market for NFTs and other crypto-assets

It is interesting that, according to the statement, the rugpull mastermind is only charged with the fact that the buyers of his NFTs did not receive “rewards”, “bonuses” and “airdrops”.

“Society became far too toxic”

There is some irony in the fact that 6,797 “mutants” of this collection are still offered on OpenSea, the largest NFT marketplace. Meanwhile, some of them are only worth $10.

Michel has reportedly confirmed the fact of the carpet cover in private. However, he is sure that the buyers of the NFTs themselves are to blame for this drama:

We never intended to incubate, but society became far too toxic

According to an IRS officer, the defendants “can no longer blame the NFT community” for their criminal activity and should be held accountable for the fraud.