<![CDATA[fraud lawyer - Conaway & Strickler]]> https://www.conawayandstrickler.com/blog/tags/fraud-lawyer/ Tue, 25 Feb 2025 15:31:37 GMT en-us <![CDATA[The Intersection of Crime and Non-Fungible Tokens (NFTs)]]> https://www.conawayandstrickler.com/blog/the-intersection-of-crime-and-non-fungible-tokens-nfts/ https://www.conawayandstrickler.com/blog/the-intersection-of-crime-and-non-fungible-tokens-nfts/ Tue, 14 Nov 2023 16:23:31 GMT An NFT, or Non-Fungible Token, is a digital asset representing ownership or proof of authenticity of a unique item or piece of content using blockchain technology. Unlike cryptocurrencies such as Bitcoin or Ethereum, which are fungible and can be exchanged on a one-to-one basis, NFTs are non-interchangeable and one-of-a-kind. As long as you’re following copyright…

]]> An NFT, or Non-Fungible Token, is a digital asset representing ownership or proof of authenticity of a unique item or piece of content using blockchain technology. Unlike cryptocurrencies such as Bitcoin or Ethereum, which are fungible and can be exchanged on a one-to-one basis, NFTs are non-interchangeable and one-of-a-kind. As long as you’re following copyright laws and selling legitimate assets, creating, selling, and reselling NFTs is legal. However, due to the decentralized and anonymous nature of the crypto world, NFTs come with a host of legal issues. Like with most digital innovations, regulatory legislation has been slow to catch up and establish clear guidelines; still, wrongful use of NFTs can implicate an array of criminal charges.

Money Laundering refers to the illegal process of concealing the origins of money obtained through criminal activities, making it appear as if it comes from a legitimate source. This is criminalized under 18 U.S.C. § 1956. Money laundering using NFTs involves the illicit use of these digital assets to disguise the origins of illegally obtained funds. In this context, individuals create a fake record of sales on the blockchain by selling NFTs to themselves using different accounts. Once finished, they sell the NFT to an unsuspecting buyer and repeat the process.

Fraud has grown increasingly common in the crypto landscape due to its anonymous and decentralized nature. Fraud involving NFTs can manifest in various ways due to the unique characteristics of these digital assets. This is mostly being prosecuted as wire fraud under 18 U.S.C. § 1343. Some common forms of fraud associated with NFTs include:

  1. Fake or Stolen NFTs: Fraudsters might create counterfeit NFTs by copying digital content and attempting to sell them as original or rare pieces. Additionally, they might steal someone else’s artwork or content and mint NFTs to sell without the creator’s consent.
  2. False Representation: Individuals might misrepresent the ownership or authenticity of an NFT by falsely claiming it is associated with a particular creator or source, leading buyers to believe they are purchasing something of higher value or legitimacy than it actually holds.
  3. Pump-and-Dump Schemes: Similar to traditional financial markets, some individuals may engage in pump-and-dump schemes within the NFT market. This involves artificially inflating the value of certain NFTs through false hype or manipulation, only to sell them off at a high price, leaving unsuspecting buyers with devalued assets.
  4. Phishing and Scams: Scammers may use phishing techniques to trick NFT owners into providing their private keys or access to their digital wallets, allowing the fraudster to steal the NFTs. Additionally, fraudulent schemes and fake NFT marketplaces can deceive buyers and sellers into making transactions for non-existent or misrepresented NFTs.
  5. Rug-Pull Scheme: As the term suggests, a “rug pull” refers to a scenario where the creator of an NFT and/or gaming project solicits investments and then abruptly abandons a project and fraudulently retains the project investors’ funds.

Law enforcement is continuing to prosecute these types of NFT schemes across the nation, in cases that allege millions of dollars being defrauded. Two defendants were charged for executing a $1 million NFT money laundering and fraud scheme in January 2022. In another NFT rug-pull, Aurelien Michel was charged for diverting $2.9 million dollars in an international fraud scheme.

]]> <![CDATA[How is White Collar Crime Generally Prosecuted?]]> https://www.conawayandstrickler.com/blog/how-is-white-collar-crime-generally-prosecuted/ https://www.conawayandstrickler.com/blog/how-is-white-collar-crime-generally-prosecuted/ Mon, 10 Jul 2023 17:17:13 GMT The Department of Justice investigates and prosecutes cases where large amounts of money is alleged to have been taken. Examples of white collar crimes are money laundering, bank, wire and mail fraud, tax evasion, insider trading, insurance fraud, mortgage fraud, bribery and embezzlement. Of course Homeland Security, the FBI, the IRS, Customs and Border Patrol…

]]> The Department of Justice investigates and prosecutes cases where large amounts of money is alleged to have been taken. Examples of white collar crimes are money laundering, bank, wire and mail fraud, tax evasion, insider trading, insurance fraud, mortgage fraud, bribery and embezzlement. Of course Homeland Security, the FBI, the IRS, Customs and Border Patrol and SEC can also investigate and prosecute cases of fraud as well.

The government has a special United States Guideline Chapter dedicated to “basic” economic offenses. For purposes of this blog, this chapter will be discussed in more detail below. As with anything involving federal criminal litigation, nothing is crystal clear in the law. Therefore, there is also a chapter in the United States Guidelines dedicated to tax offenses, election fraud, gambling, and money laundering in the United States Sentencing Guidelines.

This USSG chapter DOES cover extortion, bribery, kickbacks, counterfeiting, embezzlement, health care fraud, computer fraud, insurance fraud, securities fraud, mortgage fraud, identity fraud, bankruptcy fraud, etc. What is most important in this chapter is the loss amount. All charges start off with a base offense level of 6 or 7 depending on the statutory max of the offense charged. Then, you look at what the “loss amount” is using the below table.

Loss (apply the greatest)Increase in Level
(A) $6,500 or lessno increase
(B) More than $6,500add 2
(C) More than $15,000add 4
(D) More than $40,000add 6
(E) More than $95,000add 8
(F) More than $150,000add 10
(G) More than $250,000add 12
(H) More than $550,000add 14
(I) More than $1,500,000add 16
(J) More than $3,500,000add 18
(K) More than $9,500,000add 20
(L) More than $25,000,000add 22
(M) More than $65,000,000add 24
(N) More than $150,000,000add 26
(O) More than $250,000,000add 28
(P) More than $550,000,000add 30.

The loss amount is a pandora box of confusion and the government is able to add all kinds of relevant conduct and intended loss conduct to inflate these numbers.

To further make things complicated, there are enhancements in this section that permit the government to add levels for things such as the use of sophisticated means, role in the offense, number of victims, a defrauding a charity, mass marketing, among others.

Navigating the federal criminal system is a task that should not be endured alone. Contact our team today for more information about we can protect your rights and your freedom.

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