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Police across Europe have arrested five suspects in a cross-border operation coordinated by Eurojust that targeted an online cryptocurrency investment scam that defrauded victims of at least €100 million.
The arrests, which included the alleged main organizer, took place during a joint action day that also saw searches carried out and bank accounts and other assets frozen in Spain, Portugal, Italy, Romania and Bulgaria, Eurojust said Wednesday.
The suspected organizer is under investigation for large-scale fraud and money laundering. Authorities said the scheme lured investors onto professionally designed platforms that promised high returns from cryptocurrencies. Instead, much of the money was diverted to bank accounts in Lithuania. When victims tried to withdraw their funds, they were told to pay additional fees, and the websites would vanish, leaving them with partial or total losses.
“Cryptocurrency investment schemes are a common fraud typology,” said Dr. Tom Robinson, Co-Founder and Chief Scientist at Elliptic. “Investors should be very wary of any such scheme, especially if it has been recommended by someone they've met through social media or a messaging app.”
Such scams often don't actually involve cryptocurrency at all, he explained.
“Fraudsters sometimes just use the concept of cryptocurrency investment, since it combines technical complexity with the perception that there are easy gains to be made — a potent combination. However in these cases, cryptocurrencies might subsequently be used by the scammers to launder their illicit proceeds,” Robinson told OCCRP.
Eurojust said the fraud has been active since at least 2018, spanning 23 countries either as victim locations or as jurisdictions used to move illicit proceeds. The agency helped set up a joint investigation team between Spain and Lithuania to enable information sharing, and coordinated European Arrest Warrants, Investigation Orders and freezing orders.
Europol, which has supported national investigators since September 2020, joined the action day and deployed a cryptocurrency specialist to Portugal to assist with asset seizures.
