Federal prosecutors have unveiled charges against two men from California in what is being described as the largest non-fungible token (NFT) fraud scheme prosecuted to date, alleging they deceived investors out of more than $22 million through a series of digital asset “rug pulls.” The six-count indictment, announced on Friday, accuses Gabriel Hay, 23, of Beverly Hills, and Gavin Mayo, 23, of Thousand Oaks, of masterminding bogus NFT and cryptocurrency ventures before abandoning them after amassing millions from unsuspecting investors.
From May 2021 to May 2024, Hay and Mayo reportedly promoted multiple NFT and digital asset projects, such as Vault of Gems, Faceless, and MoonPortal, leveraging deceptive tactics to attract funds, according to court records. The indictment claims they provided phony project “roadmaps” outlining grand promises they never intended to fulfill. One highlighted case involved the Vault of Gems project, where they misrepresented the NFTs as “pegged to a hard asset,” a claim authorities deem false.
Officials stated, “Gabriel Hay and Gavin Mayo defrauded investors in digital asset projects of tens of millions of dollars and harassed an individual who tried to disclose their fraudulent activities.” Authorities reaffirmed their commitment to protecting investors and vowed to collaborate with law enforcement to root out cryptocurrency fraud.
The indictment further alleges that Hay and Mayo targeted a manager of the Faceless NFT project who exposed their connection to the fraud, launching a campaign of harassment that included intimidating messages aimed at causing emotional distress.
The charges include conspiracy to commit wire fraud, wire fraud, and stalking. If convicted, each defendant may face up to 20 years in prison for the fraud charges and up to five years for stalking.
“When new investment trends arise, scammers quickly follow,” remarked a spokesperson for the legal team handling the case. “Continued efforts will be made to protect consumers while holding criminals accountable for their involvement in crypto fraud.”
Authorities have emphasized that Hay and Mayo attempted to disguise their involvement in the projects by misrepresenting other individuals as the real owners. The indictment indicates that similar tactics were employed across various projects, including Clout Coin, Dirty Dogs, and Roost Coin.
Investigations into the case are being conducted by federal authorities, who encourage anyone who suspects they fell victim to these schemes to report their experience directly to law enforcement.
