EU Arrests Nine in Connection with $689M Crypto Scam Network
Police across Cyprus, Spain, and Germany, coordinated by Eurojust, arrested nine individuals involved in a cryptocurrency money laundering network responsible for defrauding victims of €600 million ($689 million). The network created numerous fake crypto investment platforms and lured victims through social media, cold calls, and fake advertisements. The stolen funds were laundered using multiple blockchain platforms. Authorities seized €800,000 in bank accounts, €415,000 in cryptocurrency, and €300,000 in cash. The case highlights the increasing sophistication of crypto-related scams, with global losses from such fraud reaching $12.4 billion in 2024. Organizations like TRM Labs warn these schemes often exploit social engineering and online trust-building to deceive victims before laundering stolen funds through unlicensed platforms. Experts advise skepticism towards unsolicited investment offers promising high returns.
Nine Arrests in Multi-Country Action Against Crypto Money Laundering
Police in Cyprus, Spain, and Germany have arrested nine individuals in connection with a crypto money laundering network that defrauded victims of $689 million (€600 million). Coordinated by Eurojust, the EU agency for criminal justice cooperation, the operation took place on October 27 and 29, with France and Belgium also participating.
Fraudulent Crypto Scams and Laundering Mechanisms
The suspects established a cryptocurrency money laundering network, creating “dozens” of fraudulent crypto investment websites. They lured victims via social media, cold calls, fake news articles, and ads from influencers, promising high returns on investments. When victims transferred their cryptocurrency, the funds were laundered across multiple blockchain platforms.
In total, the network successfully laundered the aforementioned €600 million, but Eurojust’s coordinated actions led to the seizure of $919,000 (€800,000) in bank accounts, $476,760 (€415,000) in cryptocurrency, and $344,652 (€300,000) in cash.
International Collaboration to Dismantle the Network
The operation stemmed from victim complaints, prompting Eurojust to establish a joint investigation involving French and Belgian authorities. This investigation expanded to include Germany, Spain, and Cyprus, whose agencies collaborated with their French and Belgian counterparts to devise a strategy to dismantle the network.
Rising Complexity of Crypto Crimes
Europol’s Burkhard Mühl, the head of the European Financial and Economic Crime Centre, highlighted the rising sophistication of crypto-based criminal activities. This operation occurred amidst a backdrop of escalating losses from crypto scams, which reached $12.4 billion in 2024, according to Chainalysis. This figure represents a marked increase over the past three years.
Industry Experts Warn of Growing Crypto Scams
Eurojust’s press team confirmed an increase in cases reported, although they admitted a lack of comprehensive data due to the absence of a reporting obligation for EU member states. Similarly, other intelligence reports confirmed the worsening situation. Ari Redbord, VP at TRM Labs, stated that fraudulent investment schemes are one of the largest and fastest-growing sources of illicit funds in the crypto industry, with $53 billion in scams tracked since 2023, and the real figure likely higher as only 15%-20% of victims report their losses.
Sophisticated Tactics in Crypto Investment Scams
Crypto scams are increasingly using social engineering tactics. Ari Redbord explained how scammers build trust through messaging apps, social media, or dating sites, sometimes over weeks or months, to guide victims to fake trading platforms. These sites often appear professional, complete with fake dashboards and profit reports.
Cryptocurrencies sent during these scams are often quickly converted to stablecoins and laundered through unlicensed intermediaries or over-the-counter brokers.
Protecting Against Crypto Scams
The best defense against such scams is healthy skepticism. Redbord emphasized that no legitimate investment opportunity guarantees high returns. Be skeptical of unsolicited messages offering investment opportunities on social media or apps, and never transfer funds to a personal wallet or unknown third party.