Original author: Horlomite Research
Original translation: Block unicorn
@Luca Netz acquired Pudgy Penguins for 750ETH (worth $2.5 million) at the time, almost entirely through a series of sales and manipulation, in which he and his partners were involved.
At the end of this article, you will see on-chain evidence showing that 99.06% of Luca's contribution came from shares he acquired through six different sales operations. These projects raised millions of dollars, promising various benefits such as animated series, comic books, BAYC lottery, and more. However, none of these benefits materialized, and the only beneficiary was Luca Netz, who received millions of dollars into his various wallets. You will see that these individuals are a group of serial fraudsters involved in fraudulent activities across multiple industries.
Luca's Early Years
Before venturing into NFTs, Luca Netz, the CEO of Pudgy Penguins, had a series of remarkable, public, and often exaggerated enterprises and plans. His self-given name "The Beverly Hills Bandit" is quite fitting. We will detail how he created multiple NFT scams before joining Pudgy Penguins, his malicious marketing strategies, his paid trading groups, his claims of "teaching you how to make money," hyping dozens of tokens and tokens he dumped, multiple arrests, turning his friends into a fake expert and using them to sell courses, committing multiple securities fraud and telecommunications fraud, and more. You will learn that Luca has done every trick in the fraudster's handbook.
To better understand him, we will start by exploring his early criminal career. Some of Luca's initial criminal activities included stealing from local stores, dropping out of school at 16, admitting to being a drug dealer. Some of his other early adventures included deceiving property owners, renting them large warehouses, and holding illegal parties without their knowledge. Despite being arrested multiple times, he avoided imprisonment because he was a minor at the time and the contracts he signed were not legally binding, shifting the responsibility of his actions onto the property owners. Quoting Luca: "Believe me, on these streets, on these streets of Los Angeles, being a young adventurer… I can't even talk about the stuff I've done now." Here are the videos:
https://rumble.com/v2n93da-2-luca-netz-about-hosting-illegal-parties-clip.html
https://rumble.com/v2n9bms-3-luca-netz-cant-even-talk-about-the-stuff-ive-done-now-clip.html
https://youtu.be/BVEdMdl2kXQ?t=5149
https://youtu.be/Kj-5T0H1Lns?t=386
In 2017, he started his first company named "LA Gold Cartel, LLC," of which he still serves as the CEO:
https://opencorporates.com/companies/us_ca/201723610245
He used the newly established company to sell fake jewelry, counterfeit Airpods, and other devices, and utilized influencers like 'Supremepatty' to promote their counterfeit goods. The company used promotional images of genuine Apple products while selling counterfeit goods. These items were advertised as free, but during checkout, an exorbitant shipping fee, exceeding industry standards, was added to profit and deceive customers.
If a seller intentionally inflates shipping costs to cover the actual price of an item while claiming the item is free, this would be considered deceptive or fraudulent business practices under California law. Not to mention, selling counterfeit goods and using images of their genuine products on the website is highly deceptive.
Web Archive link:
https://web.archive.org/web/20200602065940/https://www.supremepatty.com/
Here is a quote from Luca: "I started my first consumer-facing business selling fake gold chains and cubic zirconia diamonds to people who wanted to wear jewelry like rap artists." Here are the video links:
https://rumble.com/v2n8y7e-1-luca-netz-about-selling-fake-jewlery-clip.html
https://twitter.com/supremepatty/status/1006009187548057605?s=20
Like other professional scammers, Luca began buying fake news reports related to himself to create a false impression of credibility. We found 10 articles written between April and May 2021, all using previously unseen photos of Luca. This includes Sun Nigeria, which we believe even falsified the date of the article to 2016, while the photo used was taken in 2021. These media outlets are often exploited by scammers and scam experts to publish false, fraudulent articles. Here is a list of news articles for sale, provided by another scammer Riachu, almost all of Luca's articles are included, with prices ranging from $200 to $1200.
Additionally, you can see an old fake news report featuring Luca and his good friend and long-term partner Nick Von. Later, we will detail how Nick has defrauded dozens of people of millions of dollars over the past few years. To illustrate the maliciousness of some of the individuals involved, you will see that Nick Von's victims include his girlfriend and his grandmother, whom he defrauded of $60,000. Here is a list of fake news articles.
Here is Nick in Luca's podcast, with the video titled "NICK VON How I Made $5 Million in DOGECOIN!!!" (Spoiler: He didn't make that much money):
https://www.youtube.com/watch?v=EvuQRRVJQQU
Ironically, one of the articles mistook Luca for a namesake German footballer. Our advice to Luca is that the next time he wants to manipulate his public image by buying fake news, he should proofread the articles about himself before the seller publishes them.
We believe that he purchased these articles to enhance his reputation, as he was preparing to execute his largest fraud to date, which he has been trying to cover up since the acquisition of Pudgy Penguins.
Netz Trade
Luca's next venture began in 2021, which he called Netz Trade, a Discord group open only to subscribers, offering trading advice and "automatic trading signals." Around this time, he also launched a reselling course worth $1700. Through this course, we can see early signs of Luca's success, as he taught students to buy Instagram accounts with a large following, purchase fake likes, and create fake comments. Eventually, he even started providing sports betting signals.
To entice people to buy these services, he showcased suspicious trading results, showing huge profits, while also boasting about the performance of his reselling store. On his website, he used the logos of the fake news articles he purchased to increase his credibility, a classic scammer move of "as seen on." Unsurprisingly, at the time, neither Yahoo nor Business Insider had published any articles about him; he simply inserted fraudulent promotions among all the fake articles.
The question we raise is, why does someone who is "proficient" in trading and an "8-figure reseller" need to sell not just one but multiple paid groups and multiple courses?
It can be said that some business courses can provide value for money. After evaluating some of his courses, we can conclude that they are nothing special, and we believe there are better free courses available on platforms like YouTube. However, the problem arises when you start selling dreams to people, telling them to "join and start making money immediately," when you overpromise and underdeliver, when you teach your "students" malicious business strategies that they will continue to use to harm consumers, and when you ultimately abandon them.
Furthermore, why would someone with the intention of helping people, who paid thousands of dollars for a course that supposedly would make them financially free, encourage those paying customers to engage in gambling? Below is a message from one of the administrators of Luca's Discord group encouraging members to gamble and use their referral links while doing so. He is enticing them to engage in something mathematically destined to fail, which has ruined countless lives, and boldly sharing his referral link, remember, the casino only pays them when the people they refer lose money.
Saving Koalas Scam Gimmick
In a section of his $1700 advanced course, Luca is teaching students about "secret insider methods." The course details strategies such as brand building, running ad campaigns, and copywriting.
The focus product is a series of bracelets and necklaces purchased from Chinese suppliers at the lowest cost and marked up five times the purchase price. His marketing tactic is to sell these jewelry items seemingly as part of a charity initiative to protect endangered Australian koalas from wildfires. According to his promotional claims, a portion of the profits from each purchase will be donated to save and protect these animals. Yes, you read that right, his entire course is teaching people how to deceive those who have sympathy for Australian koalas, as this was during the time of the Australian bushfires, and koalas were suffering from the fires.
Although we strongly doubt that Luca would donate any portion of the profits apart from protecting himself from legal liability, even if he did donate half of the profits, this is still a highly suspicious way of making money, almost bordering on fraud. What's worse is that he has taught thousands of people, potentially creating a small army of "Beverly Hills Bandits," to deceive people by exploiting their sympathy.
https://rumble.com/v2nbbj6-4-luca-netz-saving-endangered-koalas-from-fire-sarcasm.html
In another part of the course, Luca Netz discusses how to make a lot of money by creating a false sense of value for a random Chinese product. He achieves this by listing high-end products from well-known brands on his website and marking them as sold out, leaving only his products available for purchase. He also mentions that his friend tried this strategy but failed because "nobody put in the effort to get Instagram followers, buy likes, fake a lot of stuff, do similar things…". He continues to show people where to buy fake followers, comments, and followers to more easily deceive their customers.
In mid-2022, Luca Netz apparently faced public criticism from Twitter users for his Netz Trades and courses. However, it was reported that the critical tweets received little attention and were later deleted because Luca threatened legal action. The authenticity of these statements has not been fully confirmed in the article, and the author is seeking more information from the individuals who posted the tweets.
Please note that the information provided is based on the content you shared, and its accuracy may need to be verified.
We believe this made Luca realize that he needed to distance himself quickly from Netz Trades and Netz Commerce, so he did. He promptly shut down the netztrades.com and netzcommerce.com websites and deleted their social media accounts. Thanks to web archives, we can still see the original appearance of these websites, links as follows:
https://web.archive.org/web/20211207172136/https://netztrades.com/home1
https://web.archive.org/web/20211207032233/https://netzcommerce.com/homepage-1
The monthly profits from this were too tempting for Luca, so he decided to merge Netz Trades and Netz Commerce into "Internet Accelerator," without even bothering to notify his members, who had to consult support representatives to find out why the name of the Discord server had changed.
Some members believe this is Luca's response to Andrew Tate's Hustlers University, suspecting that he created an all-in-one package to compete with him, where you can follow their trading advice, use their automatic trading signals, become an eight-figure jumper like Luca, and view their daily sports betting recommendations.
Although this new all-in-one package does seem like one of the new scams Luca would attempt, and this is likely one of his main motivations, we still believe the main reason for the rebranding is to distance himself.
Approximately 7 months ago, Luca posted his last message on Discord, and since then, the Discord has been gradually declining, with less and less activity, but still with hundreds of paying members. Another major issue is that many people purchased annual subscriptions or his $1700 Netz Commerce package, which granted them lifetime access to these groups, but Luca decided to completely abandon them, not posting a single message for several months, many of whom are die-hard fans of Luca. We believe they are more devoted to Luca than any Pudgy Penguin owner, as they believed in the dreams he sold to them, yet his actions show that he doesn't care about them (his users) at all.
Like a traditional guru, Luca made it difficult for his subscribers to unsubscribe. If they wanted to unsubscribe, they had to contact customer service, and the response time was quite long.
If you are reading this, it is very likely that Luca has deleted the website for Internet Accelerator, so here is a web archive link:
https://web.archive.org/web/20221010015532/https://www.internetaccelerator.io/
We believe it's only a matter of time before he and his partners, like they did with other seemingly less profitable ventures, abandon Pudgy Penguins and move on to the next scam.
Scam Master
Another scam Luca attempted was using his friend Noah Tucker to be the face behind his courses. He planned to teach him how to pretend to be a course guru, meaning he and his friend would deceive people by claiming he had been successful in e-commerce, showing false results, and having people write false articles for him, just like he did.
Quoting Noah Tucker: "This is when we were making the course together, I don't know if you remember, when we started that course, I literally had no money, I didn't make anything," so let's think again, a broke person is about to launch a course teaching others how to make money! They actually launched this course, it lasted for a while, they advertised it, but eventually gave up, Luca continued to launch Netz Trades and Netz Commerce, you can see them discussing this in the following video:
https://rumble.com/v2nfhp4-6-luca-netz-on-starting-a-course-with-noah-who-was-broke-at-the-time.html
Noah Tucker also has an article about him that we suspect is paid for. The article claims that he became a millionaire reseller at the age of 20. The question we raise is, why would a millionaire need a small investment from Luca to start his new business?
A few months later, Luca and Peter Lobanov (a shareholder of Pudgy Penguins) invested in Noah's new company, SocialSnowball.
NFT Scam
Little known is that before the acquisition of Pudgy Penguins, Luca actually launched several other NFT projects. These projects were operated in secret by Luca and his team members. Here is the evidence we have collected.
The acquisition funds for Pudgy Penguins were provided by Luca Netz, Lorenzo Melendez (also known as 0xLoMel), Ulysses Atkeson from Cowboy Labs (also known as UnLink, CowboyUly), and Charles Kieu (also known as ICanPlug, evaded, evaded.eth). On the day of the Pudgy Penguins purchase announcement, this address received funds, and approximately 68% of the funds were subsequently sent to Coinbase's deposit address, which had been used multiple times by the deployers of Pudgy Penguins. The wallet used for the purchase was/has been controlled by Luca, as later transactions sent the funds to an unmarked alternative wallet owned by Luca.
The funds provided by Luca and Cowboy Labs can be directly traced to multiple dump projects. Specifically, Luca and Cowboy Labs' Spooky Boy Country Club (SBCC), their sister series Spooky Boy Mansion Party (SBMP), Demi Gods Universe (DGU), Donut Shop (DS), and Cookies N’ Kicks (CNK). All of these projects, in part or in whole, failed to deliver on their initial promises and roadmaps.
SBCC seems to be the first project where Luca acted as a project founder or, according to the team page on the SBCC website, a "board member." However, when examining the on-chain activity of the SBCC deployer wallet and the sources of deployer funds, Luca's status as a board member is questionable.
The SBCC deployer's fund wallet, 0xa0ce (SBCC Funder), is one of Luca's early personal wallets. This connection is easily established for two reasons. The first is that SBCC Funder transferred the "sale" of BAYC #9608 to Luca's current public wallet 0x3f8c, and the proceeds from that sale were sent to Coinbase's deposit address. This Coinbase deposit address had received deposits from both SBCC Funder and the confirmed alternative wallet of Luca, and this connection was strengthened in one instance, where the deposit address received funds from these two previously mentioned wallets within a span of only 13 seconds, just one Ethereum block (Tx 1, Tx 2). Luca's alternative wallets associated with each other have sent and received ETH over the past two years, with records from September 4, 2021, to April 9, 2023. Proof that this wallet belongs to Luca is simple. SBCC Funder has sent and received funds to Luca's main wallet and alternative wallet over the past two years (Tx 1, Tx 2, Tx 3, Tx 4, Tx 5).
After extracting minting funds from the SBCC contract, the SBCC deployer distributed the funds to ten main wallets and some other wallets that received small amounts of funds. Eight of these main wallets can be confirmed to belong to Luca through on-chain activity. These eight wallets include Luca's main wallet, SBCC Funder, and a wallet used in Luca's future dump project DGU. The remaining two wallets are cowboylabs.eth and minecraftco.eth. Minecraftco.eth seems to belong to a collaborator who worked with Luca on some early projects, apparently a marketing director; this address has had multiple transactions with known marketing service providers, including Snow Promotions. Interestingly, it seems to be where Luca began working with the Cowboy Labs team, as the SBCC deployer sent approximately 76 ETH to cowboylabs.eth.
SBMP, the sister series of SBCC, was deployed 36 days later, raising approximately 575.5 ETH. Within six days of the initial contract deployment, the majority of the minting funds were distributed to seven wallets controlled by Luca, including four alternative wallets, his main wallet, and SBCC Funder. The remaining funds were sent to an unmarked Cowboy Labs address, minecraftco.eth, and various miscellaneous wallets. The third collection, SpooKeys, was also released, but it was available for free to existing SBCC and SBMP holders.
By observing simple ETH transfers between these alternative wallets and Luca's main public wallet, sharing transaction deposit addresses with other wallets confirmed to belong to Luca, or subsequent activity with alternative wallets confirmed to belong to Luca, all of Luca's alternative wallets can be traced.
Address activity chart:
https://metasleuth.io/result/eth/0xf7ae375da3bc2be346157159cedc2d2effe7797fa6f2622c347506b2a758a1cb?source=b6b9331e-28f6-4f5e-8e4d-0b2bb3b049dc
On January 9, 2022, Luca created a group chat with his partner Nick and someone providing NFT promotion services, inquiring about the services they offered. When asked which projects they wanted to promote, Nick replied, "Demigods Universe and CNK World." They were seeking to purchase "Telegram promotion" services. The source providing these screenshots requested to remain anonymous.
By contacting some of his colleagues, we have confirmed that this is Luca's phone number. When we added this number to our WhatsApp contacts, Luca appeared in the profile picture; when we searched on Telegram, it had a Pudgy avatar. In the image below, you can see most of this number. We don't want to disclose the entire number to avoid violating Twitter's guidelines, but we have left a portion for anyone who has his number to verify for themselves. Additionally, some members of the Netz Trades Discord also suspect that Luca is the person speaking in the Demigods' Twitter space.
By searching for his friend's number on Telegram, we found an account @nicholasravid, who claims to be a co-owner of Pudgy Penguins in his profile.
Luca is also the fifth-largest holder of Demigods, holding 9 CNK, in his public wallet chain:
https://etherscan.io/address/0x3f8cD3cc58391E704A2A0fab2482B8116Cb9D670
Demi Gods Universe
Luca's next dump project was Demi Gods Universe (DGU). DGU appears to be the first "official" collaboration project between Luca and Cowboy Labs. This is evidenced by cowboylabs.eth providing initial funds to the DGU Deployer. Approximately five days after the contract deployment, 272.28 ETH was extracted from the DGU contract, between two transactions, and distributed to wallets controlled by Luca (which also received minting funds from SBCC), Luca's Coinbase deposit address, Luca's alternative wallet, minecraftco.eth, an unmarked Cowboy Labs address, and a Gnosis Safe.
This Gnosis Safe briefly collected royalties from the DGU series (the Gnosis Safe was quickly emptied, and the funds were sent to a wallet likely controlled by jay724.eth). Overall, Luca received approximately 63% of the minting profits from DGU. Within nine minutes of receiving his share of the minting funds, 5 ETH was sent to the aforementioned Coinbase deposit address, confirming it indeed belonged to Luca.
Most of the funds Luca received from the DGU minting were aggregated into a wallet that remained inactive for nearly 50 days. Forty-one days after the first withdrawal transaction from that wallet, 250 ETH was provided to purchase Pudgy Penguins.
Address activity chart:
https://metasleuth.io/result/eth/0xce1435b7580aa99793a6ca6e492a0250852cffd1a1bafc0f569500cc7f0c9cfc?source=a71ad53a-d374-4011-be46-841322f95ea2
The project was launched on December 21, 2021, and a total of 3120 NFTs were minted, each priced at 0.1 ETH, bringing Luca and Nick a profit of 312 ETH, valued at $1.37 million at the time.
Based on the average price of the last 10 sold NFTs, their price has plummeted by an astonishing 99.84%, with each NFT now worth only $0.74, while the minting price was 0.1 ETH.
They decided to shut down their Discord and their website, but with the help of the web archive, we were able to see how their website looked at the time and investigate all the promises they made.
https://web.archive.org/web/20211223030424/https://www.demigodsuniverse.com/
Here are a series of promises:
"(Q4 2021) - All minters will receive exclusive access in Discord and will start to benefit from this universe." — Discord has been closed since then.
"(Q4 2021) - Once all the mini gods have been given their paths by the universe and have been sorted into their factions, each faction will receive an airdrop of a secret weapon. This secret weapon will be used as a voting mechanism in our Demi Gods Universe DAO, allowing Demi Gods to use them in the eternal war. The secret weapons will allow Demi Gods to choose how they want to fight in the eternal war." — The DAO was never launched, there was no "eternal war," and the weapons had no practical use.
"(Q1 2022) - The first comic series of Demi Gods Universe will be released. Holders of Demi Gods will benefit greatly from the comics. Holders of Demi Gods will receive a 30% share from the exclusive Demi Gods comic book sales. The features used in the comic book will also receive an additional 40% sales share, on top of the 30% allocated to the holders. This 40% depends on the characters, features, and factions in each comic series. Additionally, if you are the sole holder, you will receive a total of 5% of the comic book minting every quarter." — The comic series was never released, and holders did not receive any rewards.
"(Q2 2022) - Demi Gods Universe will collaborate with another NFT, which we will showcase in our comic book. This will allow new Demi Gods to join the universe, and we will provide more utility through the collaboration. Holders will receive the same benefits as before, and the commanders of Demi Gods Universe will ensure that the collaboration is strategic to ensure maximum value for the universe and its holders." — Nothing happened.
"(Q3 2022) - Demi Gods Universe plans to publish physical comic books! We will collaborate with the best publishers and comic book artists to launch our physical comic books. Holders will receive a 5% share of global comic book sales and will be invited to our official release party!" — Holders did not receive any sales percentage, and the official release party did not take place.
Based on the information provided, it is evident that these individuals engaged in securities fraud through misleading statements, including deceptive promises of financial benefits and potential monetary returns related to a certain percentage of comic book sales that were not fulfilled, as well as other benefits. Therefore, it is clear that their actions have violated legal and ethical boundaries.
Luca and Nick also publicly announced on their Twitter that anyone who purchased their NFTs would automatically participate in a Bored Ape Yacht Club (BAYC) giveaway worth $250,000. However, this giveaway never took place, and they actually deceived everyone who participated in the NFT purchases. This involves significant violations of multiple U.S. laws and likely constitutes fraudulent misrepresentation and telecommunications fraud, and we hope that the relevant U.S. authorities will take appropriate action.
Please note that I am not a lawyer, and this information does not constitute legal advice. It is advisable to consult legal professionals specializing in such matters for specific guidance.
We also found that this project to some extent replicated "Divine Anarchy," as both projects adopted similar anime-style designs, promised to release comic books, offered similar benefits, mentioned an eternal battle of good and evil, and planned to airdrop items to help them in these "battles." "Divine Anarchy" airdropped animals, while "Demigods Universe" airdropped weapons.
Interestingly, "Divine Anarchy" was initiated by Luke Belmar, who abandoned it shortly due to a problematic minting contract, resulting in a loss of $3 million. Luke Belmar is also a shareholder of Pudgy Penguins and a long-time friend of Luca Netz, and we will investigate this further later.
CNK World
The last project Luca collaborated on with Cowboy Labs was Cookies N' Kicks (CNK). On the first day after being funded by cowboylabs.eth, the CNK Deployer extracted 234.08 ETH from the CNK contract and divided these funds into two parts, with one part deposited into a Kraken deposit address owned by Cowboy Labs and the other part deposited into an intermediate wallet for further fund dispersion. These funds were primarily allocated to Luca's main wallet, Luca's alternative wallet, an integration address owned by Luca for the Pudgy Penguins acquisition, and two Coinbase deposit addresses likely owned by Luca. The remaining funds, approximately 30%, were allocated to various other wallets not controlled by Luca.
Address activity chart
https://metasleuth.io/result/eth/0x483b29deb863d43a630a23262eb90225a599655ec9e1a180dcaa930ad79b8721?source=ecd72eca-e9b6-4d03-8d58-33c179c3cb8d
During our research on CNK, we found that a YouTuber had already posted two videos about this scam. These videos did not mention the connection between Luca and his other scams and mainly focused on the second owner, Eli Hyman. Nevertheless, if you are interested, we recommend watching these videos.
Part 1: https://www.youtube.com/watch?v=YjluOX2qOWo
Part 2: https://www.youtube.com/watch?v=i3Wb52-u-zk
CNK stands for Cookies and Kicks, a sneaker store located on Melrose Ave in Los Angeles, and one of the partners is Luca Netz. He has openly discussed his involvement with this store multiple times, and based on the text we shared, we can see him inquiring about CNK's marketing services. He even participated in a podcast titled "Luca Netz - The Shopify Titan Behind Cookies N’ Kicks." Here is a clip of him discussing the topic:
https://rumble.com/v2nxloq-luca-netz-about-cookies-n-kicks.html
In addition to the Demigod scam, Luca also decided to launch this NFT scam project, CNK World, using the brand of his sneaker store, Cookies N’ Kicks.
So far, any mention of CNK World has been deleted from Cookies N’ Kicks' social media. Their Twitter account has been deleted, and the username has been used by someone else in February. All discussion channels in their Discord have been deleted, and all posts on their Instagram page have also been deleted. Today, only their website cnkworld.io is still active.
We suspect that they may have deleted their website after our research was published, so here is the web archive link to their website:
https://web.archive.org/web/20220209092537/https://www.cnkworld.io/
To promote this NFT project, they purchased ads from Instagram pages and TikTok influencers. Here is the email they sent to a TikToker inquiring about the cost: "
One paid advertisement specifically mentioned the rapid growth of CNK and their quick acquisition of 80,000 members on Discord. Considering that only 0.43% of CNK Discord members were active, we believe Luca purchased and added fake members and followers to his social media pages to create the illusion of credibility and value, just as he teaches in his courses (teaching clients how to create fake marketing).
The initial NFT sale of CNK World took place on February 9, 2022, with a minting price of 0.1 ETH, resulting in a total of 3,150 NFTs minted and a profit of 315 ETH, valued at approximately $961,000 at the time.
Based on the average price of the last 10 NFTs sold, they were trading at a staggering $9.1 each, representing a 97% drop from the minting price.
Here are some of the promises they made:
Like the other projects these scammers were involved in, they announced on May 12, 2022, that they were abandoning this project.
Below is a message posted by CNK's co-owner Eli Hayman in the Discord announcement channel, presenting two options to their NFT holders. Option A was to introduce a new team to replace them, and Option B was to transfer ownership to the community. The full message is as follows:
Ironically, in this message, they stated, "We absolutely have no intention of disappearing, nor do we have any plans to stop taking the necessary steps to position this project for future success. We are not a Rug-pull." However, they did exactly that, as their last announcement on Discord and last activity on social media were 11 months ago.
Even the actual sneaker store has closed, and it appears that most employees decided to leave after realizing the fraudulent activities of the owners.
This pattern of abandoning projects has occurred in every project these individuals were involved in, and you will see more examples of this as we delve into more fraudulent activities of this team. This is why we believe these individuals are not fit to run Pudgy Penguins or any other business, and it's only a matter of time before they abandon this project and defraud more people in the process.
Acquisition of Pudgy Penguin
The funds used to purchase Pudgy Penguins were almost entirely obtained through defrauding thousands of investors who were previously involved in various fraudulent projects by Luca. These projects include those owned and guided by Luca, such as SBCC, SBMP, DGU, and CNK, as well as projects he provided advice or other assistance to, including Skulltoons and DS. The profits from these projects can be directly linked to on-chain activities to the address used to purchase Pudgy from Cole.
It is easy to confirm that the Pudgy Penguins acquisition address was used for the purchase, as a total of 2.2 million USD worth of ETH was sent to the address from various exchanges, as well as wallets owned by Luca and Charles Kieu. Within the next 10 minutes, 662.75 ETH was distributed to a Coinbase deposit address and another EOA, each receiving 33% and 67% of the funds, respectively.
The Coinbase deposit address was previously used by the original Pudgy Penguins deployer wallet and jonahtj.eth. This EOA likely belongs to Cole, as the same address was used for the Blur airdrop from MyFuckingPickle, of which he is the founder, and CryptoFoxes, a project he assisted in promoting. 23 minutes after the fund split, the official Pudgy Penguins Twitter account and Luca would tweet about the acquisition.
The first address to send funds to the acquisition wallet was Pudgy Payer 0x82Ad. This address served as an integration address for Luca's SBCC and DGU payments, as well as Luca's 0x59B8 integration address, both of which have interacted with each other and have sent or received funds to or from Luca's main wallet or SBCC Funder (previously confirmed to be owned by Luca). Pudgy Payer also received funds from Luca's main wallet and CNK intermediate wallet. The second address to send funds to this address was Skulltoons' intermediate wallet.
This address was the primary recipient of the minting funds, with ETH being dispersed to various wallets, including four of Luca's alternative wallets (along with other wallets associated with Luca), totaling 41.81 ETH, and Pudgy Payer receiving a total of 100 ETH.
20 hours later, Luca's main wallet sent a total of 19 ETH to the acquisition address through two transactions; one hour later, an alternative wallet funded by Luca for Skulltoons and DS sent a total of 31.75 ETH.
Address activity chart:
https://metasleuth.io/result/eth/0x9998de6a33ba91c0b1e44f7d59b01614d7b32a28edba100649baae06e8da8559?source=bdba7e05-a1ed-4cf3-a093-76ec46f4f80c
The Assetbender
Luke Belmar, or as he likes to call himself, "The Assetbender," is a long-time friend and business partner of Luca Netz. He previously served as the former Chief Marketing Officer (CMO) and shareholder of Pudgy Penguins, and we believe that most of the funds contributed to the purchase of Pudgy Penguins from exchanges were his, making him a 30% shareholder of Pudgy Penguins. Like Luca, he also launched an NFT project, had a paid membership group, and offered multiple courses and e-books on cross-border e-commerce.
If you were to search for him on Google, you would find a LinkedIn search result where he claims to be a shareholder and former Chief Marketing Officer (CMO) of Pudgy Penguins. This has been removed from his LinkedIn profile, but still shows in the metadata of LinkedIn search results. Let's take a look at some of his entrepreneurial projects.
In mid-2021, Luke launched Capital Club, a monthly $40 subscription service that granted access to his private Instagram stories. He claimed to only allow 400 people to join, which, if we believe him, would mean he could make $16,000 in profit each month.
Luke promised to share "value" and "secret methods" in his private stories, but also pledged to use 100% of the subscription fees to fund the development of the Capital Club app. The app was supposed to be an all-in-one platform where members could engage in discussions, and he also claimed he would invite some of the top health experts, financial experts, and lawyers to join the app. Early subscribers were promised lower prices and some additional benefits.
Over two years have passed, and Luke still has not launched the app or provided any updates or explanations to subscribers. Like Luca, he also made canceling the subscription very difficult, requiring contacting customer service via email and going through a lengthy process to cancel.
Here is a receipt shared with us by a former member:
A few months later, feeling the NFT wave approaching, Luke decided to shift focus and launch an NFT collection. This collection was later copied by Luca Netz, who launched Demigods, and we cannot confirm if Luke was involved in the Demigods project.
On November 6, 2021, Divine Anarchy was launched, selling the entire collection of 10,000 NFTs at a price of 0.09 ETH each, resulting in a profit of 900 ETH, valued at approximately $4 million at the time.
Their minting contract had a flaw, instead of checking available digits beforehand or writing a simple require statement to check if the supply had run out, the contract was designed to continuously attempt to generate random numbers and check if they had been allocated. However, after all 10,000 NFTs were minted, these numbers were clearly already allocated, leading to an infinite loop in the contract that ran until all the gas was consumed, resulting in over $3 million in losses for those attempting to mint. On the minting day, the Divine Anarchy project was responsible for collecting a 30% miner fee.
Despite earning $4 million from the minting, they decided not to refund any funds to the affected individuals, many of whom had spent thousands of dollars on gas fees and received nothing in return. They simply promised to launch another NFT collection, an extension of Divine Anarchy, and airdrop it to the affected individuals.
Shortly after, Luke decided to abandon the project and hand it over to the remaining team members, following the same pattern as his other friends.
The team seemed to continue working on the project, developing some features and airdropping a batch of NFT collections to those affected by the flawed contract. Unfortunately, these NFTs turned out to be worthless.
After abandoning his own project, Luke decided to engage in a new fraudulent activity. He used the proceeds from the sale of the Divine Anarchy project to purchase Pudgy Penguins with Luca. He also launched a "red-pill" YouTube channel and, leveraging his newly accumulated audience, was re-launching Capital Club, but no, he still did not provide the promised app and instead launched it on Discord.
Faiz Warsani
Faiz Warsani is one of Luca's close friends, and he also launched an NFT project, has a cross-border e-commerce course, and created his own trading group. So far, we can see a recurring pattern.
Like Luca, Faiz also purchased fake news to create the illusion of credibility. Here are 6 fake news articles we found, published by some media outlets known for selling such services, all within a month.
His course website has been taken offline, but through web archives, we can see what his website looked like, and his course was priced at $500, link:
https://web.archive.org/web/20210226090241/https://www.futurcommercecourse.com/
Donut Shop NFT
Donut Shop is a project launched in collaboration with Cowboy Labs by Faiz Warsani, with support from Luca and "Laboratory 721". The NFT sale took place on February 6, 2022, three days before Luca's CNK World NFT. Like every other project, Donut Shop NFT failed to deliver according to its roadmap and promises.
Two days after deployment, the Donut Shop Deployer (DS Deployer) extracted 673.64 ETH from the Donut Shop contract and distributed 84.5% of the funds to various wallets controlled by Faiz Warsani, 5% to Luca, about 7% to Cowboy Labs, about 2% to Laboratory 721, and the remaining approximately 1.5% to various other wallets. Luca's share of the funds from the DS minting will be split between Coinbase, his main wallet, and his alternative wallets, with the remaining funds used to artificially raise the floor price of his next collection, Cookies N’ Kicks, which will be released the next day.
Some of Faiz's funds were used to artificially raise the floor price of DS by purchasing 50 DS NFTs. Address activity chart:
https://metasleuth.io/result/eth/0x1b36966cfe5fb2dacc424875351da08e62ef1e5f17bf2a6930e770b1d066cde5?source=77e51fbe-2eb1-4fc2-a581-b4ced26afc36
They sold 5432 NFTs at a price of 0.12 ETH each, bringing in a profit of 652 ETH, valued at $1.96 million at the time.
Based on the recent average price of the last 10 NFTs sold, they were trading at a staggering $19 each, considering this was twice the CNK trading price, which is quite impressive. Unfortunately, this represents a 95% drop from the minting price.
Given the fact that only about 3% of Discord members were online, we suspect Faiz also purchased fake Discord members and fake social media followers to fabricate credibility, just like Luca did in his two projects.
Of course, this project was abandoned a few months after launch, with none of the promises fulfilled, the website was shut down, and the last Discord announcement was made 10 months ago.
Website Web Archive Link:
https://web.archive.org/web/20220706000305/https://www.donutshop.io/
Ironically, their last announcement said "We're almost there, almost there!" and then they decided to remain silent for the next 10 months.
Apart from being Luca's close friend, let's see what else connects Faiz to Pudgy Penguins.
Bureaux is a design company owned by Peter Lobanov, who is Luca's business partner, childhood friend, creative director, and co-owner of Pudgy Penguins.
Bureaux was responsible for developing the website and creating product models for Faiz's company sweetdreams.io. They collaborated with him before the launch of Faiz's NFTs and continued to work with him after the launch. This strongly suggests that Bureaux also developed the Donut Shop website, as the design style of the website is very similar to that of this design company, all of which can be seen on their website bureaux.inc.
In the past two years, Faiz has also produced two podcast shows with Peter, and the most recent one even included Luca, link:
- https://www.youtube.com/watch?v=2YLdfMcBOpo
- https://www.youtube.com/watch?v=e7LlGOrvf88
In one podcast, Peter teased Faiz about the Donut Shop, and you can see how uncomfortable he looks in the video, link:
https://rumble.com/v2o15gw-9-faiz-teased-about-donut-shop.html
Additionally, he also participated in a recent Pudgy Penguins event. While we cannot verify if Faiz is a shareholder of Pudgy Penguins, based on the information we have found, we strongly suspect he might be.
Faiz Trade
As mentioned earlier, Faiz once started his own paid Discord group, but due to lack of members, he shut it down and joined Netz Trades as the new "Stocks & Options Manager," sharing profits.
Furthermore, below you can see a photo of Luca, Faiz, and Mikey, another close fraudster friend of theirs who is also a cross-border e-commerce expert. He also recently participated in a Pudgy Penguins event, but we won't delve into him further at this time. Here's a video Coffeezilla made about him almost two years ago:
Link: https://www.youtube.com/watch?v=5A-fFF571F8
Nick Von AKA Louis Vuitton Don
Meet Nick, another scammer in this group, a long-time friend and business partner of Luca. Like Luca, Nick Von launched a paid trading group and has been involved in numerous cryptocurrency frauds. If that's not enough, he has also scammed dozens of people, including his girlfriend and even his own grandmother.
First, let's get into the most notable part. Recently, Nick's girlfriend has been exposing him, accusing him of using her money, car, house, and even clothing to show off on social media, and then using the notoriety gained from the show-off to scam dozens of people.
She has made many videos about this, here are some examples, for more videos, visit her Twitter, they are truly incredible: https://twitter.com/nickvonscammer.
As you can see, she has decorated the cars Nick used to show off.
Like many of his other friends, Nick also purchased a lot of fake news, here are 10 fake articles we found.
When we spoke to his girlfriend, she claimed he took about $100,000 from her and said he was using the money to trade NFTs, and he told her he had "inside information about Pudgy Penguins," and we suspect he was involved in the acquisition because trading volume spiked significantly before the announcement, indicating that he and his friends likely used insider information to buy NFTs and then dump them.
Here is her statement: "Initially, I intended to expose him as a fake millionaire, revealing his flaunting on TikTok as nothing but a facade. However, as I delved deeper, I uncovered the web of fraud and deception that Nick Von has been operating behind the scenes for years, along with his two accomplices. Over the past five years, victims have begun to come forward, providing evidence that Nick Von has swindled amounts ranging from $6,000 to $600,000 from over 20 victims, totaling over $5 million. I had no idea he had been using assets I provided to support his fraudulent activities."
For more information on how Nick Von deceived his girlfriend, please visit the website she created specifically for Nick Von at https://www.lascammer.com/.
In a voice message sent by Nick Von to his girlfriend, we can hear him discussing his long-time friend (Luca) inviting him to create a trading group, which he thought was a great idea to showcase "his" assets and then use the trading results provided by Luca as his own, attracting people to join and pay for the group. We recommend you listen to his tone and manner of speaking in the audio file, link:
https://drive.google.com/file/d/1O1VFpgM43m6GMvBC960ELPSRJXyY_tPQ/view?usp=sharing
While we cannot verify if he was involved in the acquisition, here are the reasons we strongly suspect:
- Nick Von has been Luca's business partner for over 5 years, launching multiple businesses together, claiming to have exited a business valued at $18 million.
- Luca invested in Nick Von's email agency inboxprofits.io, which reportedly closed because Nick Von swindled one of the clients.
- Nick Von's girlfriend claims he used her money to purchase Pudgy Penguins based on "inside information" and promoted them on social media.
- He is a member of the Netz Trades (a fraudulent community teaching stock trading) team, and in addition to the voice message we presented, he also played a role as "Netz Team."
Here is Luca promoting Inboxprofits:
https://twitter.com/netz_commerce/status/1385018669353234432
Here is an excerpt from one of their fake news articles:
https://socialmediaexplorer.com/online-public-relations/nick-von-geijer-luca-schnetzler-discuss-building-an-ecommerce-empire-through-social-media/
On his website, among other false statements, he claimed to have achieved $50 million in sales in July 2021, and just 1 year later in April 2022, he increased this figure to $500 million in sales.
Nick deceived dozens of people and swindled millions of dollars, here are some examples and testimonies from some of the victims. First, here is a report from the Federal Bureau of Investigation against Nick.
Testimonies from some victims on how they were deceived by Nick:
Here is the link to Nick's girlfriend explaining how he deceived his grandmother.
Additionally, Luca's Discord channel facilitated dozens of "shitcoin" manipulations and dumps. Members would create a "shitcoin" and then invade other Telegram and Discord channels, aggressively promoting their Telegram invite links. Of course, these members would only buy during the presale of the coin and then dump it on others after it was listed.
Many Netz Trades administrators also launched numerous "shitcoins" and NFT projects themselves.
https://poocoin.app/tokens/0xc3ea844a150d8d40fc2411973a4a23d010c7ab0b
https://web.archive.org/web/20210610192512/https://sheltercrypto.com/
Cxesar is one of the administrators of Netz Trades, responsible for launching many "shitcoins" and NFT projects. He is also one of the people behind the "Yummy" shitcoin.
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