The U.S. Attorney for the Southern District of New York has filed charges against three UK nationals for their participation in wire fraud and money laundering related to the “Evolved Apes” non-fungible token (NFT) scam.
In a statement released Thursday, the court accused Mohamed-Amin Atcha, Mohamed Rilaz Waleedh, and Daood Hassan of orchestrating a rugpull scheme, deceiving victims into purchasing NFTs.
The “Evolved Apes” NFT collection, comprising 10,000 digital collectibles on the OpenSea marketplace, purported to be tied to the development of a highly lucrative video game. However, the alleged scam involved no actual game development and resulted in no profits.
According to court documents, the perpetrators swiftly shuttered the project’s website after pocketing funds from investors, failing to deliver on their promises. Subsequently, they laundered the embezzled funds using various cryptocurrencies.
U.S. Attorney Damian Williams stated, “The defendants are accused of perpetrating a scheme to inflate the value of digital artwork by making false claims about the development of a video game. They allegedly misappropriated investor funds, failed to deliver the promised game, and profited from their actions.”
In October 2023, the developers of the Evolved Apes project vanished with $2.9 million, equivalent to 798 ETH at the time. The trio of defendants is alleged to have executed a pump-and-dump maneuver, subsequently transferring the proceeds of the fraudulent scheme to their personal accounts.
FBI Takes Action Against Evolved Apes NFT Fraud
Attorney Williams emphasized that despite the novelty of NFTs, fraudulent activities like these fall under established regulations for money laundering. He affirmed that those responsible for the deception will face consequences.
“As we allege, thousands of individuals were misled by these false assurances and deceived into purchasing these NFTs, including within the Southern District of New York,” he added.
Each of the defendants involved in the Evolved Apes case is charged with one count of conspiracy to commit wire fraud and money laundering. The court has specified that they could face a maximum sentence of 20 years in prison.
The Federal Bureau of Investigation (FBI) has been diligently gathering information on this matter. “The FBI remains steadfast in its commitment to pursuing individuals who engage in fraudulent schemes motivated by personal greed for quick profits,” stated FBI Assistant Director-in-Charge James Smith.
