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The developer behind the Mutant Ape Planet non-fungible token (NFT) collection pleaded guilty on Tuesday to defrauding buyers in a $3 million rug pull.
Guilty Plea And Consequences
Aurelien Michel, a French citizen residing in the United Arab Emirates, has pleaded guilty to charges of conspiracy to commit wire fraud. He was arrested earlier this year at JFK Airport in New York by Homeland Security Investigation agents. The charges stemmed from accusations of defrauding investors in his Mutant Ape Planet NFT collection, amounting to $3 million.
Pleading guilty to conspiracy to commit wire fraud, Michel now faces a potential prison term of up to five years. As part of the plea agreement, he has also consented to forfeit $1.4 million, with the fate of the remaining $1.6 million yet to be determined.
The Mutant Ape Planet Fraud
Inspired by the success of the Bored Ape Yacht Club (BAYC) NFT collections, Aurelien Michel launched Mutant Ape Planet. Despite lacking endorsement from the original BAYC creator, YugaLabs, Michel’s project gained popularity within a short period.
The project, however, took an unfortunate turn for investors. Normally, most NFT projects meet their demise due to poor financial strategies or external attacks. However, Michel’s collection abruptly vanished from OpenSea, leading to concerns of fraud among the investors.
Michel, posting under the alias “James,” addressed the rug pull in the community’s Discord channel, stating,
“We never intended to rug, but the community went way too toxic. I recognize that our behavior led to this.”
The Mutant Ape collection had promised investors future opportunities, merchandise, and additional perks. Regrettably, these assurances proved hollow. A year after blaming the community, Michel admitted that he and his team had never intended to fulfill their promises, revealing a rug pull had been the plan from the start.
Commitment to Investor Protection
U.S. Attorney Breon Peace emphasized the commitment to safeguarding investors, whether in the crypto sphere or elsewhere.
“With today’s guilty plea, Michel has admitted that he conspired with others to defraud consumers eager to participate in a new digital asset market. Our Office is acutely aware that criminal actors are taking advantage of the constant pace of innovation in the digital asset space and the investing public’s desire to become involved in cryptocurrency to perpetrate large-scale frauds. Holding these criminal actors accountable and protecting the public is, and will remain, a priority of this Office.”
Aurelien Michel’s sentencing is scheduled for a later date. The case reinforces the ongoing need for accountability and protection against fraudulent activities in the evolving landscape of digital assets.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.