Mutant Ape Planet NFT developer charged with fraud for selling ‘worthless asset’

Hull Invest

The Eastern District of New York Department of Justice released a criminal complaint on January 5 against Aurelien Michel, developer of Mutant Ape Planet, alleging that he defrauded investors.

Michelle was arrested at JFK airport on January 4 and is expected to appear before a magistrate within 24 hours.

This is the first time such charges have been filed against an NFT project within the Eastern District of New York.

Additionally, language within the complaint highlights that the owners of the Mutant Ape Planet NFTs were “not provided with the promised benefits.” Instead, Michelle allegedly pulled his funds into his own wallet, failing to deliver on the project’s roadmap. The complaint also called NFTs without “promised benefits” “worthless assets.”

U.S. Attorney for the Eastern District of New York Breon Peace said:

“As alleged, defendants used traditional criminal schemes to defraud consumers eager to participate in new digital asset markets. It extends to all consumers and investors, including those participating in other rapidly evolving markets for crypto assets.”

The complaint states that Miche “falsely promised numerous rewards and benefits designed to increase the demand and value of the newly acquired NFTs.” In an alleged “rag pull”, Michel tried to take away $3 million in investor funds.

Mutant Ape Planet offered “exclusive opportunities for additional investments, giveaways, merchandise, and other rewards.” The investor received her NFT, but no additional benefits. Failure to deliver the benefits outlined in the roadmap is therefore considered a crime in New York.

Michel is said to have said in a Discord chat, “We didn’t mean to fight, but the community has become too toxic.” However, Michelle used the pseudonym “James” to hide his true identity.

The project was issued in February 2022 at 0.15ETH. Smart, however, had a “release” feature in his contract that allowed Michel to move funds into his personal wallet. He was identified because there was a wallet on the exchange account he did his KYC with.

A $3 million NFT lag-pull may be unfortunately commonplace in the cryptocurrency industry, but the DOJ’s prosecution of a project that failed to provide additional benefits is a milestone in NFT regulation. It can be moment. Furthermore, if the complaint leads to a conviction, it will set a precedent for the NFT project.

Much of the NFT space is the Wild West in terms of regulation. Clarification comes from the courts, with clear guidelines from the governing body.

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