US-Brazil investigation leads to disruption of transnational cryptocurrency fraud ring
An investigation by the Brazilian Federal Police, U.S. Homeland Security Investigations (HSI) and multiple law enforcement partners led to the disruption of a transnational cryptocurrency fraud ring based in Curitiba, Brazil, Oct. 6.
As part of Operation Poyais, the Brazilian Federal Police executed 20 search and seizure warrants in the states of Parana, Santa Catarina, Sao Paulo and Rio de Janeiro, Brazil, for multiple violations of Brazilian criminal statutes.
The violations include international money laundering, operating a criminal enterprise, fraud, and crimes against the national financial system.
The warrants are the culmination of a multi-year police investigation into a transnational cryptocurrency fraud ring led by a 37-yearold Brazilian national and former U.S. resident.
The U.S. investigation revealed that the organization allegedly deceived investors in over a dozen countries by falsely claiming that they had developed fully functioning, cutting-edge cryptocurrency-related financial products. In reality, the organization is suspected of advertising fraudulent partnerships and licenses that were used to dupe victims into investing millions into cryptocurrencies minted by the suspects. The cryptocurrencies eventually held little to no value.
In January 2022, after the leader of the transnational criminal organization relocated from the U.S. to Brazil, HSI special agents assigned to the U.S. Embassy in Brasilia, Brazil, requested the assistance of the Brazilian Federal Police in coordinating binational investigative efforts. A subsequent investigation by Brazilian authorities identified similar criminal activities being conducted in Brazil, with an estimated 4 billion Brazilian Reais ($800 million) moved via the Brazilian banking system alone, separate from illicit proceeds that were transferred via cryptocurrency.
HSI special agents and task force officers from the HSI New York El Dorado Task Force and HSI Brazil led U.S. investigative efforts, working in concert with HSI Orlando, the New York City Police Department, the New York City Sheriff’s Office, and the State of Florida’s Office of Financial Regulation. The U.S Attorney’s Office Southern District of New York and the Department of Justice Office of International Affairs provided significant legal assistance to the investigation.
HSI is the principal investigative arm of the U.S. Department of Homeland Security (DHS), responsible for investigating transnational crime and threats, specifically those criminal organizations that exploit the global infrastructure through which international trade, travel, and finance move. HSI’s workforce of over 10,400 employees consists of more than 6,800 special agents assigned to 225 cities throughout the United States, and 86 overseas locations in 55 countries. HSI’s international presence represents DHS’s largest investigative law enforcement presence abroad and one of the largest international footprints in U.S. law enforcement.