US authorities have charged 20-year-olds Ethan Nguyen and Andre Llacuna with conspiracy to commit wire fraud and money laundering by defrauding the purchasers of Non-Fungible Tokens (NFTs) advertised as ‘Frosties’.
The Frosties website misled all visitors by specifying that Frosties NFT purchasers would receive various benefits. However, in January 2022, the defendants, with their identities concealed, abruptly abandoned the Frosties NFT project hours after selling all the NFTs. Thereafter, they deactivated their website, and transferred nearly $1.1 million in cryptocurrency proceeds from the scheme to cryptocurrency wallets that they controlled. They performed all transactions in a manner that attempted to conceal the source of the funds.
Before the authorities arrested Nguyen and Llacuna in Los Angeles, California, the defendants were preparing to launch the sale of a second set of NFTs. Had they succeeded in launching this scheme, they could have generated nearly $1.5 million in cryptocurrency proceeds.
Source: US Department of Justice