Australian “finfluencer” sued $370K for shilling coins after crypto trade went bad

  • An Australian crypto influencer now owes one of his follower $370,000 after leading him into “investment opportunities” that never paid out.
  • Now missing in action, the “finfluencer” has also been accused of duping followers into a fake NFT project.

An Australian crypto influencer has been successfully sued by one of his followers for fake investment advertising. The “finfluencer” now owes his follower nearly AU$500,000 ($371,000) for persuading him into a number of touted investment opportunities that never paid off.

The defendant, Alex Saunders, is the founder of Nugget News, the now-dark paywalled digital media channel. After sidelining pharmacy to venture into cryptocurrency, Saunders pitched several crypto funds and development projects to his followers. One of them, Ziv Himmelfarb, got wind of the Saunders’ projects after the two interacted on Facebook Messenger.

Thereafter, between February and May this year, Himmelfarb sent Saunders three payments. The transaction consisted of nearly AU$335,000 ($249,000) in Bitcoin and over AU$144,000 ($107,000) in Ether, about AU$479,000 ($356,000) in total. However, when the investments failed to yield, Himmelfarb requested a refund to no avail, causing him to seek civil action in August.

Crypto influencer sued for scam business deal

The plaintiff claims that the finfluencer promised a “more traditional investment product.” On the contrary, what he sold was unregistered in Australia, Himmelfarb says, thereby violating their investment contract.

Since then, Saunders has not made any attempts to respond to these allegations. His social media accounts have also been inactive since July, just before Himmelfarb sued him.

A crypto influencer sued by one of his followers is the first of such cases in Australia. Himmelfarb’s $AU492,000 ($365,000) payment was calculated by the court to include his principal, interest, and legal costs. Should Saunders fail to pay within 21 days of the ruling, the plaintiff can file for a creditor’s bankruptcy petition. This compels the sale of Saunders’ assets to repay Himmelfarb.

Further fanning the flames of his deceit, Saunders launched a “shady” NFT sale in November 2020. He issued 100 of the collectibles, each priced at 1 ETH ($520 then, $3,800 now). The NFTs were meant to grant holders access to a Nuggets News HQ, an Ethereum-powered digital realm Decentraland. As the crypto influencer communicated on Facebook, the NFT buyers would gain access to “an educational, collaborative workspace in virtual reality,” equipped with digital offices and a function center.

However, Polygonal Mind, the firm hired to develop the virtual space, never got paid. In August, Saunders was faced with a number of disgruntled NFT holders, demanding a refund, Australian Financial Review (AFR) recounts.

Daniel Garcia, Polygonal Mind’s chief executive says the Decentraland assignment was finished, but Saunders repeatedly postponed its launch date. Later on, the company discovered the rest of Saunders’ issues and decided to let the project go. According to Garcia, Saunders seems to have tarnished his reputation in what could have been a very lucrative crypto venture.

I believe he could have made a lot of money running this legitimate business, so why all this shady stuff?

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