Senior Airman in US Air Force Arrested in NFT Scheme
An active-duty senior airman in the United States Air Force, Devin Alan Rhoden, has been arrested after being implicated in a scheme involving the promotion of non-fungible tokens (NFTs). Rhoden, who works as a cyber analyst for the Air Force, was arrested earlier this week according to a report from the newsletter Court Watch, in partnership with Forbes.
Alleged “Rug Pull” Scheme: Air Force Cyber Analyst Implicated
According to a criminal complaint filed with the Middle District of Florida, Rhoden was allegedly involved in a “rug pull” scheme. In a rug pull, a digital asset is promoted to attract investors before the project is abandoned. Rhoden is said to have promoted UndeadApes NFTs, using the username “Deviinz” on Discord and X (previously Twitter).
Victim Loses Trust as UndeadApes NFT Value Plummets
The main victim, an Air Force veteran, joined a Discord channel for the UndeadApes NFT group. Rhoden, as “Deviinz,” allegedly played up the value of the NFTs, leading to an increase in price. The project also claimed to have a collaboration with the larger NFT collective, Stone Ape Crew. However, when Stone Ape Crew revealed that there was no collaboration, the value of UndeadApes NFTs plummeted, leaving investors feeling deceived and calling them “worthless.”
Money Laundering and Wire Fraud: Evidence Against Airman
Rhoden allegedly collected and withdrew approximately $80,000 from his Coinbase account in April 2022. The court filing suggests that much of this money is connected to the alleged fraudulent activity. In May 2022, Rhoden and his wife reportedly purchased a home in Florida for just over $300,000. During the underwriting process, Rhoden provided bank statements that reflected the fraudulent proceeds.
Air Force Analyst Admits to Marketing NFT Services, Denies Fraud
The court documents reveal that Rhoden made several incriminating searches after the rug pull incident, including queries on wire fraud, money laundering, and Discord logs. Discord logs were provided by the social media app, showing Rhoden bragging about the money the NFT group had brought in.
During an interview with the Air Force Office of Special Investigations, Rhoden admitted to marketing his services to NFT developers on Discord but denied any knowledge of fraud. Rhoden claimed that he thought his skills could be used to bring in money from the cryptocurrency space.
As of Thursday, Rhoden is reportedly out on a $20,000 bond. No further court dates have been scheduled for the case. This case will be closely watched as it represents one of the first criminal cases involving NFTs.
Analyst comment
This news can be seen as negative for the market. The arrest of a US Air Force analyst implicated in a “rug pull” scheme involving NFTs has caused investors to lose trust. The value of the UndeadApes NFTs plummeted, leaving investors feeling deceived. The evidence of money laundering and wire fraud against the airman adds further negative sentiment. This case is a significant development in the criminal cases involving NFTs and may contribute to increased skepticism and regulatory scrutiny in the NFT market.
