It seems that Dubai has become a major hotspot for cryptocurrency-related scams. With NFT’s being the current thing, lots of dubious characters are looking to get in on the hype.
A French national residing in the United Arab Emirates, Aurelien Michel, has been charged with defrauding purchasers of “Mutant Ape Planet” non-fungible tokens (NFTs) of more than $2.9 million in cryptocurrency. According to the Department of Justice’s press release, the scheme involved marketing NFTs to purchasers, who were promised rewards and benefits that would increase the value of their newly acquired NFTs, but after selling out of the NFTs, the purchasers were “rug pulled” as none of the promised benefits were provided. Instead, millions worth of the NFT purchasers’ cryptocurrency was allegedly used for Michel’s personal benefit.
The arrest of Michel took place on the 4th of January 2023 at John F. Kennedy International Airport and his initial appearance is scheduled for the 5th of January before United States Magistrate Judge James R. Cho. The charges were announced by the United States Attorney for the Eastern District of New York, Breon Peace, along with law enforcement agencies such as Homeland Security Investigations (HSI) and Internal Revenue Service-Criminal Investigation (IRS-CI).
The press release states “As alleged, the defendant used a traditional criminal scheme to defraud consumers eager to participate in a new digital asset market,” and United States Attorney Peace added “Protection from fraud and manipulation extends to all consumers and investors, including those participating in the fast-evolving market for NFTs and other crypto assets. Our Office is committed to bringing to justice any criminal actor abusing any markets for their own gain.”
This case highlights the importance of being cautious when investing in NFTs or other digital assets, as well as the need for increased regulation and oversight in the fast-evolving NFT market. It also serves as a warning to NFT developers that they will be held accountable if they engage in fraudulent activities, and that the law enforcement agencies are actively investigating fraud in the NFT market.
It’s worth noting that as the NFT market is still a new field, and it can be hard for buyers to discern whether a project is legitimate or not. There are many projects out there that may not have the necessary infrastructure, or that can be just a scam, Its important for buyers to do their own research, read the whitepapers, and be aware of the risks when investing in NFTs.
In the end, the case of Michel shows how fraudulent activities in the NFT market can have real-world consequences. It can harm not only investors but also the growth of the technology. This also serves as a reminder of the importance of being vigilant and not to be swayed by promises of unrealistic returns or exclusive benefits.