Five US states announced plans to take immediate action against a Russian organization allegedly selling fraudulent NFTs to US investors for funding a metaverse casino called Flamingo Casino Club. The authorities required the entity to stop selling such digital assets, accusing it of committing fraud and selling unregistered securities.
Fraudulent Claims
Securities Regulators from Alabama, Kentucky, New Jersey, Wisconsin, and Texas said that Flamingo Casino Club had solicited unlawful investments since it started operating from Russia in March. The project promised investors lucrative profits through the sale of the NFTs – which acted as the proof of ownership of items and lands in the virtual casino.
Texas State Securities Board’s order indicated that the securitized NFTs misled investors with the so-called opportunities to earn profits generated by the virtual casino and enter into lotteries that offered lucrative prizes like Teslas, iPhones, and millions of dollars of cash.
According to the joint statement by regulators, Flamingo Casino Club has promoted numerous falsified claims for scamming people to buy their NFTs. The project claimed it had a partnership with the Nevada-based casino Flamingo Las Vegas, but it later proved that there was no such affiliation. The action also found out that the Club even lied that it had partnered with Yahoo and Marketwatch with the purpose of validating its scheme.
Operators of the alleged scam promised investors…
