Two 23-year-olds from California, Gabriel Hay and Gavin Mayo, were arrested in Los Angeles for allegedly defrauding investors of over $22 million in crypto assets through a series of NFT rug pulls.
Charges and Arrests
The United States Department of Justice announced that Gabriel Hay and Gavin Mayo face charges including conspiracy to commit wire fraud, wire fraud, and stalking. Prosecutors allege they promoted various NFT and digital asset projects, providing misleading roadmaps and making false statements about their intentions to fulfill project promises.
Fraud Schemes
One such project, Vault of Gems, was marketed as the first NFT project 'pegged to a hard asset.' However, prosecutors claim the duo abandoned the initiative after collecting millions from investors. When a project manager revealed their involvement in another NFT project, Faceless, Hay and Mayo allegedly resorted to harassment and intimidation, targeting the individual and their family. The Justice Department revealed similar tactics were used across multiple projects, including Sinful Souls, Clout Coin, Dirty Dogs, MoonPortal, and Squiggles. To obscure their involvement, they reportedly misrepresented others as the project owners.
Authorities' Response
The Justice Department emphasizes its commitment to combating digital asset fraud. Officials vow to work with law enforcement to uproot crypto fraud schemes and protect investors. 'Fraudsters take advantage of new technologies and financial products to steal investors’ hard-earned money,' Argentieri emphasized.
This situation highlights the authorities' focus on tackling fraud in digital assets, emphasizing the importance of law enforcement measures to protect investors.
