Spanish authorities have arrested the alleged leader of a $300 million crypto pyramid scheme that defrauded more than 3,000 investors. The fake investment club promised 20% annual returns and operated across several countries.
Investigators also linked the suspect to the financing of a far-right politician’s campaign and to the transfer of millions through offshore accounts.
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CryptoSpain Arrested Over Pyramid Scheme
Álvaro Romillo Castillo, known as “Cryptospain,” was detained on Thursday and denied bail. Authorities considered him a flight risk ahead of his Friday court appearance.
The arrest took place under Operation PONEI, led by the Spanish Civil Guard. Officials accuse Castillo of running an international network dedicated to fraud and money laundering through the Madeira Invest Club.
The club began operating in early 2023. It presented itself as a “private investment group” offering deals in real estate, luxury vehicles, yachts, whiskey, gold, and cryptocurrencies.
The scheme lured investors with promises of fixed returns and guaranteed buybacks. Participants believed their money was used to buy digital artworks that the club would later repurchase at a higher price.
Investigators later found no real business activity behind the operation. Instead, it functioned as a pyramid scheme, using funds from new investors to pay older ones. Authorities also revealed that the network maintained bank accounts and shell companies in at least eight countries.
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The case took a political turn when investigators uncovered potential links between Castillo and a Spanish far-right politician.
Far-Right Party Leader Faces Funding Scrutiny
According to reports, Castillo admitted to contributing $115,000 to the 2024 election campaign of Member of the European Parliament Luis “Alvise” Pérez Fernández.
Spain’s Public Prosecutor’s Office has requested a broader investigation into the politician’s campaign financing. Officials allege that Fernández sought Castillo’s help to create crypto wallets that could receive anonymous donations without government oversight.
Fernández, a prominent right-wing figure, gained popularity through social media and his criticism of immigration policies. He launched his political movement, Se Acabó La Fiesta, in April 2024.
The party won three seats during the last European Parliament elections. This success has drawn even closer scrutiny to its funding sources and possible links to illicit activity.
Against this backdrop, prosecutors are now considering expanding their probe to include Castillo’s alleged role in facilitating anonymous donations and money laundering.
If the allegations against Fernández are proven, they would reveal a deliberate use of cryptocurrency to bypass campaign finance laws and conceal the origins of political funds.
Source: https://beincrypto.com/how-a-300-million-crypto-scheme-linked-a-crypto-kingpin-to-spains-far-right/
