European Union legal agencies Eurojust and Europol have supported a coordinated action against a fraudulent online investment platform, which has defrauded 33,000 victims an estimated €89 million. Two days of police action took place in March, during which five suspects were arrested at requests of German authorities. Some 15 locations were searched in Bulgaria, Romania, and Israel. The searches included five illegal boiler rooms.
Europol estimates that the criminal network behind the fraudulent scheme has caused much more financial damage and created many more victims. Eurojust supported the actions by setting up a joint investigation team to look into the online fraud scheme in January 2023 and organizing two dedicated coordination meetings to prepare for new actions.
33 German police officers and investigators participated in the actions on the ground in Bulgaria, Romania, Georgia, and Israel, supported by Europol specialists.
During the raids and arrests, a range of high-value assets were seized, including luxury watches, electronic equipment, cash, bitcoins, bank cards, and numerous documents and data carriers.
The criminal network behind the fraud attracted investors with professional-looking banners on websites and publicity via social media, using call centres in various European countries. The scammers encouraged their victims to make small initial investments of between €200 and €250, showing high profits via fake graphics and software. Victims were then contacted by so-called personal financial advisers, who promised even higher profits on bigger investments. These higher investments were then subsequently lost, and the illegal profits were paid into the perpetrators’ bank accounts.
The fraud scheme allegedly ran between 2019 and 2021, with the suspects of the operations in 2021 or their associates recently setting up call centers in Bulgaria and Romania.
Due to low interest rates during this period, investors were attracted to investing in high-risk financial instruments, such as binary options. These are often susceptible to fraud and are therefore used in online scams. Such options are, in most cases, fixed amounts of money, serving as a guarantee for risky financial transactions or theoretical asset pricing.
Fintelegram has been exposing such schemes for years.
