PANews reported on February 15 that according to The block, the founder of CluCoin was sentenced to two years and three months in prison for admitting to wire fraud. Austin Michael Taylor, 41, was the perpetrator of the fraud and will also pay compensation and confiscate assets totaling $1.14 million.
In August 2024, Taylor pleaded guilty to one count of wire fraud involving fraudulent money transfers. According to court documents, beginning in 2022, Taylor regularly used funds allocated to CluCoin-related activities to fund his growing online gambling addiction.
Somewhat oddly, Taylor appeared to be adopting tactics from the 2017 initial coin offering (ICO) bubble to convince people to invest in the buzz of the pandemic-era bull run. According to the U.S. Attorney’s Office, Taylor used his “large social media following” to drum up interest in his CluCoin ICO.
“Taylor created a ‘white paper’ for CluCoin that was intended to educate and attract investors to the ICO and promised a philanthropic focus,” prosecutors wrote in Friday’s press release.
After the launch of the CLU token on BNB Chain in 2021, Taylor shifted CluCoin’s focus to other projects, including minting “Goobers” non-fungible tokens (NFTs), a play-and-earn web3 game called Gridlock, and the “Xenia” metaverse platform. He also organized and funded an event called NFTCon: Enter the Metaverse “to drive interest and investment in CLU, CluCoin, and related projects.”
Taylor asked the court to avoid prison time, in part because he is a military veteran. He originally faced 20 years in prison, the maximum sentence for wire fraud.
