Brazil Kicks Off Campaign To Crack Down On Crypto Crime
On Thursday, the Brazilian Federal Police raided six unnamed cryptocurrency exchanges as part of an investigation into tax fraud and money laundering involving the usage of cryptocurrencies.
On September 22, the Federal Police of Brazil, with the assistance of the Brazilian tax authority, initiated the last step of Operation Colossus, a four-year-long investigation.
More than 100 court warrants were served on six cryptocurrency exchanges, four forex operators, and arbitrage agents accused of assisting in money laundering activities.
It is anticipated that 130 federal police officers took part in Operation Colossus, delivering two arrest warrants and 37 search and seizure orders in four Brazilian states: Rio de Janeiro, Bahia, Sao Paolo, and Santa Catarina. The initiative also included 28 policemen from the Brazilian tax authority.
The perpetrators are accused of using Bitcoin assets to launder money through a remittance mechanism. According to a Federal Police news release, about $391 million was transferred during suspicious exchange activities. According to the Federal Police:
“Such resources entered and circulated through the official financial system, through shell companies, without economic and financial capacity, and passed through transit accounts until their conversion into cryptoassets that could be used abroad.”
The investigations were prompted by a report issued by Brazil’s Financial Intelligence, which discovered questionable bank activity associated with the trade of crypto assets. The alleged crimes occurred between 2017 and 2021, but the country police say they are still underway.
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