Over 50,000 Investors in Brazil Conned Out of $210 Million Plus by Crypto Pyramid Scheme
The Brazilian police recently arrested criminals in connection with a cryptocurrency pyramid scheme worth more than $200 million. The gang defrauded about 55,000 Brazilians by promising enormous profits afterward, local news media outlets reported on May 21st.
The crypto market experienced a bull run, and as a result, it spurred many Brazilians to indulge in crypto-investment schemes. Brazil’s Federal Revenue Service announced that the criminals took advantage of crypto newbies and persuaded them to invest in cryptocurrency and open crypto wallets to get a 15 percent return on all the money they invest.
In a program against crypto-schemes known as “Operation Egypto,” the Brazil tax agency merged with the police to estimate the amount of money that was lost as a result of the crypto scheme, who they say amassed to about $200 million involving 55,000 Brazilians. The “Operation Egypto” undercover activity has been side-lined to catch the cartel.
Brazil’s official stated that they lured the victims with a promise to pay 15 percent of any money they invest in the scheme in the first month.
The local media news outlet in Brazil called Correido Do Povo quoted Delegate Eduardo Dalmolin Boliis of the federal police’s Office of Corruption and Financial Crimes saying that,
“The problem with this company is that it was acting without authorization.”
Notwithstanding, an official statement by the government of Brazil stated that the trading of cryptocurrency is considered not illegal, but the company that staged the scam operated without authorization.
It is necessary also to know that that employees of the pyramid schemes used the people’s investments to buy luxuries and other things including cars and precious stones, which all impounded by the Brazilian government. Additionally, according to some reports, these employees also use the investments of the Brazilian people involved to buy and sell other cryptocurrencies.
No doubt, cryptocurrency has been a subject of the hack, and many of such cases occur almost every day. The Brazilian government has also ensured that adequate measures will be taken to curb such occurrence again. The government has also guaranteed the optimum protection of its citizens against such schemes, but will not ban authorized crypto-investments in the country.
The news of the hack in Brazil comes at the time when the United States stood against a Ponzi scheme that was connected to cryptocurrency that also declared to be backed by diamonds. The Ponzi scheme took funds worth $30 million. Although the mind behind the system Argyle Coin, Jose Angel Aman, is now being prosecuted for running a Ponzi scheme after using the funds he got from investors to buy diamond worth millions of dollars.
On this case, Eric I. Bustillo, the director of the SEC’s Miami Regional Office, stated:
“As alleged, Aman operated a complicated web of fraudulent companies to continually loot retail investors and perpetuate the Ponzi schemes as well as divert money to himself. The SEC's diligent investigative work uncovered the Ponzi schemes, and our goal is to bring justice to the harmed investors.”