A recent indictment in Los Angeles charges Gabriel Hay and Gavin Mayo with defrauding investors of over $22 million in cryptocurrency through a scheme known as “rug pulls.” This method involves collecting funds from investors for digital asset projects, then abandoning the projects and keeping the money. Both men face serious charges, including conspiracy to commit wire fraud and stalking, for their deceptive actions from 2021 to 2024. They used false identities and harassment to conceal their roles in various NFT projects. If found guilty, they could face significant prison time. The U.S. Attorney’s Office emphasizes its commitment to protecting investors from cryptocurrency fraud and holding offenders accountable.
LOS ANGELES, Calif. – A recent indictment has revealed serious allegations against two men, Gabriel Hay from Beverly Hills and Gavin Mayo from Thousand Oaks, who are charged with defrauding investors of over $22 million in cryptocurrency. The indictment, unsealed on Friday, outlines how the pair engaged in fraudulent activities known as “rugpulls.” In a rugpull scheme, scammers collect money from investors for digital projects, then abandon those projects, keeping the funds for themselves.
The U.S. Attorney’s Office for the Central District of California has charged both men with a range of offenses, including conspiracy to commit wire fraud and wire fraud itself. They are also facing a charge of stalking. According to the indictment, between May 2021 and May 2024, Hay and Mayo promoted various non-fungible token (NFT) projects, making false claims and misleading statements about their intentions.
Special Agent in Charge of Homeland Security Investigations, Michael McCarthy, emphasized the harm done to investors in digital ecosystems. He stated that using NFTs for fraudulent purposes not only misuses technology but also undermines trust in the entire digital landscape.
The indictment outlines several projects, including Vault of Gems, Sinful Souls, and Clout Coin, which the men were involved in. They allegedly disguised their identities and used deceitful practices to mislead investors. Together, Hay and Mayo are believed to have raised over $22.4 million through these scams, using complex wire transfers to obscure their activities.
U.S. Attorney Martin Estrada remarked on the ongoing threats posed by scammers in emerging investment trends, reiterating the commitment of law enforcement to protect consumers.
If convicted, Hay and Mayo could each face severe penalties, with up to 20 years in prison for each count of conspiracy and wire fraud, along with additional time for the stalking charge. Principal Deputy Attorney General Nicole M. Argentieri reinforced the Justice Department’s dedication to combating cryptocurrency fraud, stating that fraudsters exploit new technologies to steal from unsuspecting investors.
This case serves as a stark reminder of the risks associated with investing in cryptocurrency and NFTs. Investors are urged to thoroughly research and verify projects before committing funds to avoid falling victim to scams.
Tags: Cryptocurrency Fraud, NFT Scams, Rugpull Scheme, U.S. Attorney’s Office, Digital Assets
What happened with the two men from Southern California?
Two men from Southern California were charged with a fraud scheme involving NFTs and cryptocurrency. They allegedly tricked people into investing in fake projects and misused their funds.
What are NFTs, and how are they related to this case?
NFTs, or non-fungible tokens, are digital assets that represent ownership of unique items, like art or music, on the blockchain. In this case, the men used NFTs to lure investors into their fraudulent schemes.
How did the fraud scheme operate?
The fraud scheme involved promoting non-existent NFT projects and promising high returns. The men collected money from investors but did not deliver on their promises, misusing the funds for personal expenses.
What are cryptocurrency fraud schemes?
Cryptocurrency fraud schemes happen when individuals deceive others to take their money through fake investment opportunities in digital currencies or assets. These scams can involve misleading claims and high-pressure sales tactics.
What can people do to avoid falling for similar scams?
To avoid scams, it’s important to do thorough research before investing. Always look for reviews and check if the project is legitimate. Trust your instincts and avoid deals that seem too good to be true.
