United States Attorney for the Eastern District of New York announced today the unsealing of a federal indictment charging three individuals with securities fraud, wire fraud, and money laundering in connection with the SafeMoon digital asset. The trio of defendants are accused of orchestrating a scheme that misled investors and misappropriated millions in investor funds. Press Release

The government charges that the defendants allegedly misrepresented the security measures of SafeMoon's liquidity pool, deceiving investors about the pool being "locked" and, therefore, safe from manipulation. Contrary to their statements, the DOJ charges the defendants retained access to the liquidity pool and engaged in a "rug pull," a nefarious strategy common in the cryptocurrency world where developers withdraw all funds from a project, abandoning the investors.

SafeMoon, which saw its market cap soar to over $8 billion, attracted investors with its unique transaction tax feature, promising benefits like automatic distribution of tokens and increased liquidity. However, as the indictment alleges, rather than supporting investor interests, the executives diverted funds for extravagant personal purchases, such as luxury vehicles and real estate.