Brazilian Police Raid 15 Companies as Part of Crypto ‘Pyramid Scheme’ Bust

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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June 26, 2023 06:53 EDT

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Federal police officers in Brazil have performed search-and-seize raids at 15 firms in two states in a bid to break up a suspected crypto-themed “pyramid scheme.”

Per Agência Brasil, the country’s national public news agency, officers swooped on 15 unnamed companies based in the states of Santa Catarina and São Paulo on September 27.

The Federal Police Force (known locally as the PF) claimed that the firms were active “between 2017 and 2020” and said that the companies had “attracted clients” to make “investments in cryptoassets and other businesses” – promising these clients “profits beyond those that exist on the market.”

Like many crypto scams, the pyramid appears to have made promises about “guaranteed” monthly gains.

The PF said that its agents seized a variety of items during their searches, including expensive watches, laptop computers, passports, jewelry, cell phones, and firearms.

Officers said that “more than 400 people” may have lost their money in the alleged scam – and that the masterminds raked in some $5.6 million from their alleged victims.

Police Step up ‘Crypto Schemes’ Crackdown

The raids were carried out as part of what officers are calling Operation Technikós. At least 11 people have been charged and indicted, with the Federal Court issuing multiple arrest and search warrants. The identities of the individuals was not disclosed.

Police said that the individuals they had arrested had been charged with the forgery of official documents, along with “money laundering and embezzlement.”

The court has also authorized officers to block and freeze assets – including cryptoassets – held in bank accounts and wallets hosted on crypto exchanges.

The raids come days after officers raided six crypto exchanges in a massive crackdown on an international crime ring that officers say used cryptoassets to launder money.

And while the police crack down on suspected fraudsters, politicians and regulators have begun to intensify their scrutiny of the industry in Brazil – with government official hoping to exercise more control over the industry.