Brooklyn Artist Douglas Newton says he lost over $120,000 dollars in a crypto currency scam that claimed to make NFTs, or digital tokens, representative of his artwork and asked him to pay for access to the lavish profits the scammers claimed to make.
“They kept saying ‘You’re going to get a lot of money when this comes through, $310,000,’ and I believed her. I sent them $120,000 and they asked for more, and I didn’t have any more,” Newton said.
The scammers reached out to him on LinkedIn, befriended him, then directed him to a website that claimed to be affiliated with legitimate NFT site Open Seas, but according to the Brooklyn DA’s office was one of 40 scam sites that were targeting artists looking to sell their art online in a new way.
DA Eric Gonzalez tells News 12 the transactions were linked by his Virtual Currency Unit to a cash account in Nigeria, the last in over 150 such cases the unit has taken on since beginning a year ago.
“These scams account for over $40 million being taken from those in our borough,” he said adding “these are the types of frauds that people are willing to liquidate their life’s savings into.”
He says the unit was able to get a judge to sign off on seizing the fraudulent sites, that now redirect to a home screen saying they have been seized, and encouraging victims to come forward, as the quicker the better the chance the money can return.
“In some of those cases, they’re bad actors here in New York City and in the United States. And obviously, we can arrest those people and charge them. The bigger challenge is seizing the money back because often the money is going to Russia, to China. We’ve seen it go to Latin America. And in this particular case, the money went to Nigeria,” DA Gonzalez said.
His office is looking to warn consumers to always check URLs for crypto sites, to never fall for high-pressure sales tactics, and to never give out your cryptocurrency seed number or personal ID that can be used to liquidate a virtual wallet.
He says anyone with questions can reach out to the DA’s office to see if a potential site is on their “whitelist” or to flag a potential fraud.
Newtown says he is glad he came forward, and helped get these fraud sites taken down, and adds he will continue to make and sell his art, in-person and through trusted online channels.
“No more crypto. No more NFT for me,” Newtown said.
