Former UNC swimming commit Gavin Mayo has been indicted on costs that he and one other man, Gabriel Hay, defrauded buyers of greater than $22 million in cryptocurrency in what’s known as a “rugpull” scheme.
In keeping with the U.S. Justice Division, a rugpull is a “sort of fraud scheme wherein the creator of a nonfungible token (NFT) or different digital asset venture solicits funds from buyers for the venture after which abruptly abandons the venture and fraudulently retains buyers’ funds.”
Mayo and Hay, each 23, have been accused of mendacity to buyers and defrauding them of tens of tens of millions of {dollars}. They’re additionally charged with threatening a venture supervisor who tried to show the fraud.
The video beneath breaks down Mayo and his alleged position within the scheme:
Mayo is initially from Greensburg, Pennsylvania, about 45 minutes outdoors of Pittsburgh. A sprinter, he positioned ninth on the 2019 Pennsylvania AAA Boys’ State Championship meet within the 50 free and completed highschool with a lifetime better of 20.60.
Whereas he dedicated to swim on the College of North Carolina, and was briefly on the workforce’s roster, he by no means swam a meet for the Tarheels. He dropped out of UNC and launched a TikTok account leaning into the hyper-alpha-male area of interest the place he posted movies about issues like consuming uncooked rooster to get his hydration as an alternative of consuming water and referring to himself because the “youngest billionaire on the earth.”
Amongst Mayo’s initiatives was the “Vault of Gems” venture, which claimed to be the primary NFT venture backed by jewellery. He raised over $100 million on the venture after which killed it, saying the “market by no means materialized.”
“Gabriel Hay and Gavin Mayo allegedly defrauded buyers in digital asset initiatives of tens of tens of millions of {dollars} and threatened a person who tried to show their roles in these fraudulent schemes,” stated Principal Deputy Lawyer Common Nicole M. Argentieri, head of the Justice Division’s Prison Division. “Fraudsters make the most of new applied sciences and monetary merchandise to steal buyers’ hard-earned cash. The division is dedicated to defending buyers and can proceed to work with our legislation enforcement companions to root out fraud involving cryptocurrency and different digital belongings and convey offenders to justice.”
“For 3 years, Hay and Mayo apparently lied to their buyers with a purpose to defraud them out of tens of millions of {dollars},” stated HSI Government Affiliate Director Katrina W. Berger. “Such technological fraud schemes value buyers tens of millions of {dollars} yearly. Simply because such crimes aren’t violent doesn’t imply they’re victimless. HSI will proceed to analyze, disrupt, and dismantle such cryptocurrency fraud networks.”
“At any time when a brand new funding development happens, scammers are certain to observe,” stated U.S. Lawyer Martin Estrada for the Central District of California. “My workplace and our legislation enforcement companions will proceed our efforts to guard customers and punish wrongdoers concerned in crypto fraud.”
Every have been charged with one depend of conspiracy to commit wire fraud, two counts of wire fraud, and one depend of stalking.
In keeping with the Justice Division, if convicted, they every face a most penalty of 20 years in jail on every of the conspiracy and wire fraud counts and a most penalty of 5 years on the stalking depend, that means a most of 65 years of jail time are on the desk.
This has turn out to be one of many highest-profile cryptocurrency and NFT fraud circumstances to be prosecuted in the US. Within the final 18 months, convicted fraudster Sam Bankman-Fried was sentenced to 25 years in jail and Caroline Ellison was sentenced to 2 years in jail for his or her position within the collapse of the cryptocurrency change FTX, which was described as one of many greatest monetary frauds in U.S. historical past.
