Another month and another bitcoin scam added to the list (is someone making a list?). This latest scam was being investigated for three years until the police finally made an arrest. Claudio Oliveira, the self-proclaimed Bitcoin King of Brazil, has been arrested for embezzling $300 million. The scam affected over 7000 victims. This just adds to how easy it is to get scammed even if you’re semi-well informed about how crypto stuff works.
One of the reasons why China is cracking down hard on bitcoin operations is the financial risk that comes with dealing with cryptocurrency. It took authorities three years to gather enough evidence to capture Oliveira, who was the president of the Bitcoin Banco Group. The group was a well-known financial group in Brazil that made big promises of big profits if people invested in them. This happened during the cryptocurrency boom and they gathered quite a hefty sum.
It all started back in 2019 when the Banco Group reported that over 7,000 Bitcoins had gone missing. Of course, they went missing, like how the Cajee brothers were ‘hacked’ and told investors to keep quiet about it as the authorities would only make things difficult for them while they ‘recovered’ what was lost. Anyways, so the Banco Group applied for a judicial reinstatement order from the Brazilian authorities.
The judicial reinstatement order meant that the company would reorganize its finances and governance to be able to pay the investors and avoid going bankrupt. Seems like a good loophole in the law that could buy them time. So the company ran its business as usual while updating its platform and assuring clients that the bitcoins were back. Everything was going fine until a lawyer from the clients noticed inconsistencies between the numbers from the company and the audited data.
The lawyers reached out and asked for wallet data to clear out any misinformation but the Banco Group failed in doing so. This prompted the authorities to form a special task force to bring the president of the Banco Group in. The operation was dubbed “Operation Daemon” and consisted of 90 officers from the Federal Police. The task force arrested Claudio Oliveria, his wife, and others when they determined that the group’s funds had been transferred to Oliveria’s personal accounts.
According to a press release by the federal police “Police investigations also revealed that the investigated person also committed, in the past, crimes of the same nature in the United States and possibly in other European countries. The investigative work in the field also made it possible to identify people suspected of concurring in the commission of the crimes under investigation”. The Federal court has issued 22 seizure warrants.
The police have seized Oliveira’s luxury cars, jewelry, some bags of cash, and cryptocurrency hard wallets.