Arrests Made of Two 20-Year-Olds in Relation to the $1.1 Million ‘Frosties’ NFT Scam.
Ethan Nguyen and Andre Llacuna, the creators of the 'Frosties' NFT collection, vanished after securing over $1 million from backers. They have since been arrested, as revealed by the U.S. Attorney’s Office for the Southern District of New York this past Thursday.
In January 2022, 8,888 cartoon-style NFTs were introduced as 'Frosties', each starting at 0.04 ETH, approximately $124. The assets sold out within just one hour of launching, but the founders quickly fled with the funds right after the sale closed.
The two individuals were apprehended in Los Angeles two months post-scam. Prosecutors have alleged that Nguyen and Llacuna moved roughly $1.1 million in profits from their scheme into various cryptocurrency wallets they controlled, executing multiple transactions to obscure the true origins of the funds.
Both 20-year olds are charged They are facing serious charges including wire fraud and conspiracy to launder money, both of which could lead to a maximum prison sentence of 20 years.
According to the Department of Justice, just prior to their arrest, Nguyen and Llacuna were actively promoting another NFT venture called 'Embers', which was suspected to be another fraudulent scheme set to launch around March 26.
Sadly, rug pull scams are rampant in the NFT space, where developers often make off with profits, abandoning their projects and leaving their supporters in disarray.
“The hype surrounding the NFT market has captured not just legitimate creators, but also con artists. The accused masterminds allegedly disguised themselves behind fake online personas, promising their victims enticing rewards and exclusive deals before executing their deceitful rug pull and vanishing, leaving investors with empty wallets,” stated investigator Ricky J. Patel.
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