The DOJ Pulls the Rug on the Frosties NFT Founders

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On March 24, 2022, the U.S Attorney’s Office for the Southern District of New York charged two individuals for their alleged participation in a scheme to defraud purchasers of non-fungible tokens (or “NFTs”) known as “Frosties” out of over $1 million.  The two-count complaint charges Ethan Nguyen (aka “Frostie”) and Andre Llacuna (aka “heyandre”) with conspiracy to commit wire fraud in violation of 18 U.S.C. § 1349 and conspiracy to commit money laundering in violation of 18 U.S.C. § 1956.  Each charge carries a maximum sentence of 20 years in prison.

The Defendants marketed “Frosties” as the entry point to a broader online community consisting of games, reward programs, and other benefits.  In January 2022, their “Frosties” pre-sale raised approximately $1.1 million.

In a so-called “rug pull,”

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