Eight Arrested in Major Cryptocurrency Pyramid Scheme Affected Over 3,600 Victims
Criminal network reportedly defrauded more than €30 million across multiple countries, with the majority of victims based in Spain.
The National Police of Spain has apprehended eight individuals involved in a large-scale cryptocurrency pyramid scheme affecting over 3,600 victims globally.
This criminal organization operated in Málaga, Madrid, and Murcia, using fraudulent investment schemes that have reportedly defrauded victims of more than €30 million.
Following nearly three years of investigation by the Fraud section of the Central Unit for Economic and Financial Crime (UDEV) of the National Police, the operation has dismantled the network led by a programmer arrested in Málaga.
The arrested individuals, who come from various nationalities and professional backgrounds, including marketing and web design, had set up a seemingly legitimate platform that promoted investment plans in Bitcoin through online channels and social media.
The scheme enabled users to convert hundreds or thousands of euros into Bitcoin, with some victims granting the perpetrators permission to control their devices for this conversion, in addition to compromising personal and banking information.
Reports indicate that at least 3,646 victims from 36 countries fell prey to the scam, with 2,718 residents from Spain.
The fraud is estimated to involve up to 400 Bitcoins (BTC), which, given current market values of around €93,000 per Bitcoin, would total approximately €37.2 million in defrauded assets.
The scheme promised unrealistic returns, advertising potential profits of 40% within one month and up to 300% within a year.
The investigation was triggered by the complaint of a victim in Murcia in 2022, which unveiled a wider fraudulent operation where early investors received returns funded by the investments of new participants.
Such pyramid schemes inevitably collapse when investors attempt to withdraw their funds, as the structure cannot sustain the promised returns.
Upon facing withdrawal requests, the perpetrator organization implemented tactics requiring victims to pay fees to supposedly recover their investments or to reinvest in new products.
According to investigators, no investor was able to reclaim their capital as all invested funds were rerouted by the fraudsters.
Authorities have intervened, seizing 73 bank accounts, 12 cars, and 5 motorcycles linked to the criminal activities.
Additionally, the arrested individuals created a new virtual currency of no real value, further misleading investors, many of whom had no prior experience with cryptocurrency investments.
In response to this incident, authorities emphasize the importance of cautious investment practices.
They urge potential investors to verify the legitimacy of entities offering financial services with regulatory bodies and to be wary of high-return offers.
Caution is advised against the urgency of investment schemes promising quick profits, especially those requiring participants to recruit others or install remote control applications on their devices.
Individuals are encouraged to refrain from making additional contributions if they fail to recover their investments and to reject unsolicited assistance from purported law firms or asset recovery entities.
This criminal organization operated in Málaga, Madrid, and Murcia, using fraudulent investment schemes that have reportedly defrauded victims of more than €30 million.
Following nearly three years of investigation by the Fraud section of the Central Unit for Economic and Financial Crime (UDEV) of the National Police, the operation has dismantled the network led by a programmer arrested in Málaga.
The arrested individuals, who come from various nationalities and professional backgrounds, including marketing and web design, had set up a seemingly legitimate platform that promoted investment plans in Bitcoin through online channels and social media.
The scheme enabled users to convert hundreds or thousands of euros into Bitcoin, with some victims granting the perpetrators permission to control their devices for this conversion, in addition to compromising personal and banking information.
Reports indicate that at least 3,646 victims from 36 countries fell prey to the scam, with 2,718 residents from Spain.
The fraud is estimated to involve up to 400 Bitcoins (BTC), which, given current market values of around €93,000 per Bitcoin, would total approximately €37.2 million in defrauded assets.
The scheme promised unrealistic returns, advertising potential profits of 40% within one month and up to 300% within a year.
The investigation was triggered by the complaint of a victim in Murcia in 2022, which unveiled a wider fraudulent operation where early investors received returns funded by the investments of new participants.
Such pyramid schemes inevitably collapse when investors attempt to withdraw their funds, as the structure cannot sustain the promised returns.
Upon facing withdrawal requests, the perpetrator organization implemented tactics requiring victims to pay fees to supposedly recover their investments or to reinvest in new products.
According to investigators, no investor was able to reclaim their capital as all invested funds were rerouted by the fraudsters.
Authorities have intervened, seizing 73 bank accounts, 12 cars, and 5 motorcycles linked to the criminal activities.
Additionally, the arrested individuals created a new virtual currency of no real value, further misleading investors, many of whom had no prior experience with cryptocurrency investments.
In response to this incident, authorities emphasize the importance of cautious investment practices.
They urge potential investors to verify the legitimacy of entities offering financial services with regulatory bodies and to be wary of high-return offers.
Caution is advised against the urgency of investment schemes promising quick profits, especially those requiring participants to recruit others or install remote control applications on their devices.
Individuals are encouraged to refrain from making additional contributions if they fail to recover their investments and to reject unsolicited assistance from purported law firms or asset recovery entities.
Translation:
Translated by AI
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
