Three UK Citizens Charged in $3M “Evolved Apes” Ethereum NFT Scam

On June 6, 2024, the U.S. Department of Justice announced charges against Mohamed-Amin Atcha, Mohamed Rilaz Waleedh, and Daood Hassan, all UK nationals. The trio is accused of engaging in a fraudulent scheme involving the “Evolved Apes” NFT collection, leading to charges of wire fraud and money laundering. Each charge carries a potential maximum sentence of 20 years in prison.

The Scam Strategy

The defendants allegedly conducted a classic “rug pull” by promoting NFTs linked to a fictional online game. They aggressively sold the “Evolved Apes” NFTs, promising that proceeds would fund the game’s development, which would in turn boost the NFTs’ value. However, after accumulating 798 ETH (about $2.7 million), they abruptly halted the project and vanished with the funds.

Why Is It Called a Pump and Dump Scheme?

A “pump and dump” scheme involves artificially inflating the price of an asset through false or misleading statements to sell off the asset at a higher price. In the case of the “Evolved Apes,” the trio hyped the value of the NFTs by promising a non-existent video game, enticing investment and driving up prices before cashing out and disappearing, leaving investors with worthless digital assets.

Recent Scams and Rug Pulls

The “Evolved Apes” case is part of a broader pattern of cryptocurrency frauds, such as the recent ZKasino scam. In this incident, Binance’s Crime Compliance and Investigations team played a crucial role in identifying and apprehending a suspect involved in defrauding investors of over $33 million. Promising high returns within 30 days through a gambling platform, the scammer collected substantial sums in Ether from over 10,000 investors.

Like the “Evolved Apes,” ZKasino used deceitful tactics, including fictitious endorsements and promises, to lure and exploit investor trust. Authorities ultimately seized significant assets from the suspect, including cryptocurrency, real estate, and luxury cars, following a thorough investigation using blockchain analysis and OSINT.