One NFT developer has been found guilty and another has pleaded guilty to a U.S. court to conspiracy to commit wire fraud as well as money laundering, in relation to a NFT “rug pull” worth $400,000.

This comes following the sale of three NFT collections on Solana called “Undead Apes,” “Undead Lady Apes,” and the partial sale of “Undead Tombstone.” These collections minted for $5 a piece in 2022, bringing in $135,000 to wallets controlled by 21-year-old Berman Jerry Nowlin Jr. and 25-year-old Devin Alan Rhoden.

Over the following weeks, the total brought in by the scammers totalled almost $400,000 as hundreds of victims invested in the projects—with Undead Apes peaking at a price of $360 a piece.

The success of the projects was pushed by “outright false statements,” the Department of Justice (DOJ) report says. This included claims around future partnerships with “prominent businesses,” how much capital would be reinvested into the project, and details about utility that would be provided to holders.

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Author: Ryan Gladwin