Cyprus Cracks Down on €645M International Ponzi Scheme: Nine Arrested, €4M Frozen
Last week, Cyprus law enforcement made headlines as they joined forces with authorities from 11 countries and Europol to dismantle an international financial fraud scheme,worth €645 million, with alleged ties to the production of pharmaceutical cannabis.
Arrests and Seizures
A police operation involving 400 members of various prosecuting authorities resulted in:
- The arrest of nine suspects
- The seizure of €4.7 million in bank deposits
- €1,515,000 in cryptocurrencies
- €106,000 in cash
- €2.6 million in properties
These assets were linked to the fraudulent scheme,which left hundreds of thousands of European investors out of pocket.
Cyprus Banks Used for Money Laundering
Reliable sources at Cyprus’s Unit for Combating Money Laundering Crimes (MOKAS) revealed that Cyprus’s banks had been used to launder a portion of the illicit funds,leading to the identification and freezing of €4 million in total.
Scheme Advertised on Social Media
According to Europol, the scheme’s organizers—suspected individuals from Russia, the Netherlands, Germany, Italy, Latvia, Malta, Poland, Jordan, the USA, and Venezuela—had attracted potential victims through social media advertisements since early 2020. They promised lucrative investment opportunities in cannabis cultivation, harvesting, and distribution for medical purposes.
False Promises and Deceptive Practices
For just €50, prospective investors were promised exclusive access to established cannabis producers. The scheme further guaranteed a 100% return on investment, a lucrative offer that ultimately proved too good to be true. However, the scheme failed to disclose how it intended to achieve these returns.
Initially, more than 550,000 eager investors received returns on their investments. However, in July 2022, the fraudsters abruptly took down the company profiles on social media and blocked investors’ access to their accounts, seizing their funds.
Cross-border Investigation and Europol’s Role
These deceptive practices prompted an outcry from victimized investors across Europe, leading Europol to coordinate a cross-border investigation for a high-value target in the Dominican Republic. A Russian national was identified as a primary suspect and was targeted with a search warrant executed by Spanish Police and Europol experts.
Europol has been actively contributing to this large-scale cross-border investigation from its inception, leading operational coordination and providing valuable intelligence support.
Stay tuned to in-cyprus for the latest in Cyprus news and global events.