Two 20-year-olds charged in alleged $1.1M NFT scam

The duo were charged with wire fraud and conspiracy to commit money laundering for allegedly selling bogus NFTs to investors before abandoning the project, shutting down their website, and absconding with $1.1 million in digital funds.

They took the virtual money and ran.

Prosecutors in New York’s Southern District Thursday charged two 20-year-olds in connection with an alleged NFT scam.

Ethan Vinh Nguyen and Andre Marcus Quiddaoen Llacuna were charged with wire fraud and conspiracy to commit money laundering for allegedly selling bogus NFTs to investors before abandoning the project, shutting down their website, and absconding with $1.1 million in digital funds.

NFTs, or Non-Fungible Tokens, are digital assets supposedly made unique and therefore scarce through block-chain technology. In recent years NFTs have fueled a boom in sales of digital art.

“The trending market and demand for NFT investments has not only drawn the attention of real artists, but scam artists as well,” Homeland Security Investigations Special Agent In Charge Ricky Patel said in a statement. “The arrested thieves allegedly hid behind online identities where they promised investors rewards, giveaways, and exclusive opportunities before implementing their ‘rug pull’ scheme – leaving investors with empty pockets and no legitimate investment.”

Prosecutors say the pair had pulled up stakes on their so-called “Frosties” series of NFTs — deleting the website and transferring the $1.1 million across several virtual wallets — within hours of selling out the digital tokens.

Nguyen and Llacuna were planning to repeat the digital fly-by-night act with a March 26 NFT drop called “Embers”, prosecutors said.

The pair face up to 20 years in prison in convicted.