The European authorities have taken down a cryptocurrency fraud and money laundering network that is believed to have laundered over 700 million euros. Multiple European agencies collaborated in the two-phase operation, which led to the arrest of nine individuals.
Taking Down a Vast Fraud Network
According to Europol’s announcement yesterday (Thursday), “the criminal network operated numerous fake cryptocurrency investment platforms, luring thousands of victims with advertisements promising high returns.”
The perpetrators contacted the victims repeatedly from call centres, according to the agency, and used social engineering tactics to pressure them into making investments on the fake trading platforms.
The network came to light after authorities began an investigation into a single fraudulent cryptocurrency platform.
The reach and set-up of the network are said to span across Europe and beyond.
Another earlier report revealed that the European agencies removed over 1,400 fraudulent online trading platforms that tricked retail investors. German investigators, working alongside BaFin, Europol and Bulgarian authorities, traced networks of fake brokers luring users into investing large sums with promises of high returns.
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Raids and Arrests
The latest nine arrests were made in the first phase of the crackdown, which took place on 27 October, involving police raids across Cyprus, Germany and Spain at the request of French and Belgian authorities. It also resulted in the seizure of bank accounts, cash, cryptocurrencies, digital devices and high-value watches.
In the second phase of the operation, carried out on 25 and 26 November, the authorities focused on targeting the affiliate marketing set-up that supports these online scams, which use fake advertisements with photos and deep fake videos of celebrities and even politicians.
Interestingly, the Italian financial market regulator recently pointed out that deep fake ads of the country’s Prime Minister, Giorgia Meloni, are being used to promote fake investments.
Agencies from Belgium, Bulgaria, Germany and Israel conducted the latest searches against companies and suspects involved in fraudulent advertising campaigns on social media platforms.
It appears that the majority of the fraud operations were based in Cyprus, Germany and Spain, while companies in Belgium, Bulgaria, Germany and Israel ran the fake ads.
“Following these two coordinated actions and multiple arrests and seizures, investigative authorities will continue to track the criminal organisation’s assets in the countries where it operates and resides,” Europol stated.
Recently, the European authorities also closed a crypto-mixing service, “Cryptomixer,” allegedly used by cybercriminals to launder over €1.3 billion in Bitcoin. Authorities confiscated three servers, the platform’s domain, more than €25 million ($29 million) in BTC and over 12 terabytes of operational data.
