Spanish Authorities Bust 'Rip Deal' Scam Gang, 8 Arrested

Published: 19 August 2023

Rip Deal Scam SpainSpanish authorities seized millions of euros in an operation targeting rip deal scammers. (Photo: Ministerio del Interior, License)

By Erika Di Benedetto

Spanish authorities said they have dismantled an itinerant criminal group of Italian-Croatian origin involved in a series of fraudulent currency exchange schemes known as "Rip Deal" - a scam in which fraudsters trick victims into exchanging genuine legal tender bills for counterfeit ones.

Police apprehended eight individuals and seized significant amounts of money and assets during several searches.

Officers found approximately 7.1214 million euros (US$ 7.765 million) in banknotes marked with the word "FACSIMILE" and 23,645 euros ($ 25,779) in legal tender bills. In addition to the currency, three money counting machines and several mobile phones were recovered.

In a "Rip Deal" scam, fraudsters trick victims into exchanging genuine legal tender bills for counterfeit facsimile bills. The perpetrators used this method to acquire VTC licenses — licenses required for operating transportation services — valued at 70,000 euros ($ 76,319) and even attempted to negotiate the purchase of a cryptocurrency wallet worth $800,000.

The investigation began in December 2022 after a complaint was filed in Madrid concerning a "Rip Deal" scam involving the sale of the VTC licenses.

The fraudsters had convinced the victims to exchange money for bills of lesser value on the pretext of facilitating a bank transfer, thereby swindling them out of the 70,000 euros in genuine tender bills and providing them with 200-euro (US$ 218) facsimile bills.

Subsequently, another "Rip Deal" scam was reported in Madrid.

The victims were approached by the scammers and coerced into exchanging 250,000 euros (US$ 272,545) in high-value banknotes for lower-value ones. Once again, the criminals acquired the genuine tender banknotes while the victims received the equivalent amount in counterfeit facsimile bills.

Further investigation revealed that both scams were allegedly perpetrated by the same individuals, led by three brothers of Italian-Croatian descent with a history of similar offenses in Spain and other European countries. The group's operations involved logistical support, security, and counter-surveillance provided by other members.

The breakthrough in the case came when the authorities learned that the main suspects were planning a cryptocurrency scam in Valencia, located in the eastern region of Spain. The scheme was foiled and subsequently, seven individuals were caught red-handed in Valencia, and an eighth arrest was made in Lloret de Mar (Girona) in late July.

The investigation remains ongoing, with the possibility of further arrests.

In a separate search of a rented storage room in Madrid, investigators uncovered 6,000,000 euros ($ 6,539,520) in 200-euro ($ 218) and 500-euro ($ 544) banknotes marked "FACSIMILE," along with two money counting machines and various tools used in the scams.

According to Spanish law enforcement, the "Rip Deal" scams follow a three-phase process, starting with contact and building trust with victims, followed by the execution of the deception where the victims are tricked into accepting facsimile-like banknotes instead of genuine currency or assets.