A new crypto scam format now involves a fake NFT minting website website as shut down by the Brooklyn DA.
By Godfrey Benjamin
Edited by Julia Sakovich
Updated
3 mins read
Brooklyn’s District Attorney’s Office has recently taken action on fraudulent non-fungible token (NFT) operations. This action was prompted after an 85-year-old artist fell victim to a scam that led to a significant financial loss. The artist, targeted through LinkedIn, was tricked into minting his artwork on a fake NFT platform.
The artist, eager to show off his work in the growing NFT market, was convinced to mint his creations. Unfortunately, he used a fake website designed to mimic OpenSea, a leading NFT marketplace. The sophisticated look of the fake platform was convincing enough to make him trust the site.
After supposedly earning $300,000 in sales, the scammers told the artist he needed to pay a $135,000 fee to access his profits. He emptied his retirement savings, maxed out his credit cards, and took out a loan to cover the amount.
It was not long before the truth surfaced. The $300,000 profit was a mirage, and the criminals had run away with his money, leaving the artist emotionally and financially wrecked.
Brooklyn District Attorney Eric Gonzalez revealed that the scam was not an isolated incident. Investigators discovered a network of 40 fraudulent websites designed to exploit artists through similar tactics.
These fraudulent websites are often a replica of popular NFT platforms to appear legitimate. They tricked victims into revealing sensitive information, such as their crypto wallet seed phrases. This gave scammers unrestricted access to the victims’ digital assets, leaving them vulnerable to theft.
The DA’s Virtual Currency Unit traced the stolen funds to Nigeria. The funds were primarily converted into the Naira, Nigerian currency, eliminating the possibility of recovery. Further investigation suggested that the fake websites were also managed and financed from Nigeria.
Two additional victims, artists from Georgia and California, were identified as part of the same scam. Their experiences show the global reach and harmful impact of such fraud.
In response, the Brooklyn DA’s Office has taken down the fraudulent websites and warned artists in the NFT space sternly.
“Stick to established marketplaces,” the DA’s Office advised, emphasizing the importance of vigilance against phishing scams and fraudulent platforms. The office also resounded a critical safety measure for artists, including never sharing their crypto wallet seed phrase.
A similar incident in 2023 prompted the US Federal Bureau of Investigation (FBI) to issue warnings about cybercriminals posing as legitimate NFT developers. These scammers created look-alike accounts, copying reputable creators to deceive unsuspecting investors.
By promoting fake “exclusive” NFT drops, they stole cryptocurrency and other valuable digital assets from their victims. This incident sends a clear message to artists: while full of potential, the digital and NFT spaces are also filled with scams.
Artists must exercise caution when engaging with new platforms, especially those that seem too good to be true.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
