NFT promoters face fraud charges over alleged $22M rug pull
Two California residents, both 23, are facing fraud charges for allegedly orchestrating a series of NFT rug pulls, defrauding investors of over $22 million. Gabriel Hay and Gavin Mayo were arrested in Los Angeles and have been charged with conspiracy to commit wire fraud, multiple counts of wire fraud, and stalking, according to the United States Department of Justice (DOJ).
Prosecutors claim that Hay and Mayo promoted various NFT and digital asset projects, providing false and misleading information about their development and roadmaps. These projects included promises they allegedly had no intention of fulfilling. One such project, Vault of Gems, was marketed as the first NFT project “pegged to a hard asset.” However, the indictment alleges the duo abandoned the project after collecting millions from investors.
When a project manager exposed Hay and Mayo’s involvement in the Faceless NFT project, the duo allegedly resorted to harassment, targeting the individual and their family with intimidation tactics. This adds another layer of criminality to the allegations against them.
The DOJ claims Hay and Mayo were behind a string of projects, including Sinful Souls, Clout Coin, Dirty Dogs, Uncovered, MoonPortal, Squiggles, and Roost Coin, all of which used deceptive practices to lure investors. The two reportedly concealed their involvement in these ventures by falsely identifying others as project owners, further obfuscating their roles.
Authorities emphasized their dedication to combating fraud in the crypto and digital asset sectors. “Fraudsters take advantage of new technologies and financial products to steal investors’ hard-earned money,” said DOJ officials, reaffirming their commitment to holding perpetrators accountable.
This case highlights ongoing challenges in regulating the rapidly evolving world of cryptocurrencies and NFTs, where the allure of innovation often attracts bad actors.
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