Europol Arrests 15 in Massive Cryptocurrency Scam Crackdown: $1 Million Seized

On November 13, the European Union Agency for Law Enforcement Cooperation (Europol) announced that it had successfully cracked down on a criminal network engaged in online scams via call centers. The network spread throughout Europe.

According to Europol, the operation was carried out on January 11, 2023, following an investigation that began in June 2022 at the request of the German authorities. Together with the national authorities of the other countries, Europol carried out raids in 22 different locations between Bulgaria, Cyprus and Serbia. This resulted in the arrest of 15 people, 14 of whom were in Serbia and one in Germany.

Europol seizes USD 1 million in cryptocurrencies in physical wallets

In addition to the arrests, authorities also seized 3 physical wallets containing approximately $1 million in cryptocurrency and around €50,000 in cash. They also seized 3 vehicles, electronic equipment, backups with important information, and other documents. The investigation is still ongoing as the criminal network is believed to have more call centers than they raided.

According to Europol, the criminal network ran a cryptocurrency pyramid scheme through which they lured victims by offering "seemingly rare" cryptocurrency investments with the promise of guaranteed large profits. The network managed to capture hundreds of millions of euros with the operations of only 4 call centers. Many victims, however, chose not to report to law enforcement agencies, making it difficult to quantify damage.

The scammers' modus operandi was initially to request small sums of money, typically in the triple-digit range, to gain the trust of their victims. Once a more intimate relationship was established, they convinced the victims to make transfers of higher and higher amounts until the scammers had enough to stop communicating. According to Europol, the criminal network stole at least $2 million from unsuspecting people in Germany.

The use of cryptocurrencies in criminal activities

What reported Per Europol, the agency is working hand in hand with various international authorities to "stay ahead of those who abuse crypto assets to commit crimes and launder money."

However, Europol noted that although cryptocurrencies have become attractive to criminals due to their privacy and decentralization features, its use in criminal activities represents a small fraction compared to criminal activities that involved fiat money:

The use of cryptocurrencies for illicit activities seems to comprise only a small part of the overall cryptocurrency economy, and appears to be comparatively less than the amount of illicit funds involved in traditional finance.

Governments around the world are starting to pay more attention to how cryptocurrencies are used in criminal activities. One example of this is the United States government, which has taken action against certain cryptocurrency platforms that have been found to facilitate criminal activity. The most obvious case is the cryptocurrency mixer”Tornado Cash”, which was sanctioned by the US government because criminals use it to obfuscate your transactions, but others centralized exchanges they have also had to deal with the authorities for similar reasons.