NFT used to demand settlement from influencer accused of $7M fraud

In the Brief:

  • An NFT influencer known as Ben.
  • eth has received a settlement demand via NFT alleging wire fraud on a recent $7 million token presale.
  • Lawyer Mike Kanovitz served the demand letter to Ben.
  • eth's wallet address and warned of potential legal action if refunds weren't provided.
  • Ben.
  • eth responded to the letter calling it unprofessional.

3 - 6 minute read

A non-fungible token (NFT) influencer known as ‘Ben.eth’ has been accused of wire fraud on a recent $7 million token presale. Lawyer Mike Kanovitz, a partner at Loevy & Loevy, has served Ben.eth with a settlement demand letter via NFT. Kanovitz has alleged that Ben.eth used a manipulative launch strategy for the token $PSYOP, which raised $7 million in its initial pre-sale over 72 hours. The concerns revolve around how the Liquidity Pools (LP) were structured and the way that the tokens “trickled out” during the pre-sale.

“So, just send back the ETH. The matter will be over, and you and your victims can all go on with their lives. But if you insist on fucking over thousands of people, my law firm will step up to right that injustice.”

Ben.eth has tweeted that 50% of the tokens have been sent out and “the rest will be sent in short order.” However, Kanovitz has stated that a “refund is the stand-up thing to do.” He has warned of potential legal action if refunds aren’t provided. Kanovitz has stated in the letter that “At a minimum, you would be guilty of wire fraud, which is a predicate act for racketeering and the basis for a treble damages award against you ($7 million becomes $21 million).”

Kanovitz has suggested a potential “painful” process for Ben.eth, following a court filing, if the letter is not cooperated with. He further threatened a subpoena on the alleged influencer’s communications which he said, “that evidence will put the final nails in your coffin.” Kanovitz has also stated that he will reveal the in-real-life (IRL) identities of the influencers’ co-conspirators.

NFTs have been in the spotlight for the past few years, with sales reaching record highs. However, the lack of regulation and transparency has been a cause of concern for many in the industry. The allegations against Ben.eth highlight the potential risks associated with NFTs and the importance of conducting thorough due diligence before investing in any NFT project.

The Bottom Line

The allegations against Ben.eth serve as a reminder of the potential risks associated with NFTs. Traders and investors must conduct thorough due diligence before investing in any NFT project. The lack of regulation and transparency within the industry makes it imperative that traders exercise caution and take steps to protect themselves from potential fraud. The allegations against Ben.eth may also have wider implications for the NFT market, as regulators may look to introduce new measures to protect investors.

Disclaimer: The content in this article is provided for informational purposes only and should not be considered as financial or trading advice. We are not financial advisors, and trading carries high risk. Always consult a professional financial advisor before making any investment decisions.

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