Five Arrests in Crackdown on $98m Investment Fraud Gang

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European police have arrested five individuals in an attempt to bust a criminal network believed to have made €89m ($98m) from tens of thousands of victims through investment fraud.

Some 33 German law enforcers teamed up with their peers in Bulgaria, Romania, Georgia and Israel to search 15 locations including five illegal call centers, according to Europol.

Read more on law enforcement action against fraudsters: Euro Police Bust Multimillion-Dollar Crypto Fraud Gang.

The two action days in March were a follow-up to operations undertaken against the same criminal gang in 2021 and enabled police to glean new evidence that revealed a much larger cost to victims than the €15m first estimated.

The fraudsters lured potential victims through legitimate-looking website advertising and social media, encouraging them to make small initial investments of between €200–250, Europol said.

Contact center workers then called the individuals, tricking them with fake “graphics” showing the purportedly large profits they’d already made and promising even bigger returns if they invested more.

Europol claimed that persistently low interest rates at the time of the scheme (2019–21) made the high-risk investments more attractive to the victims.

In reality, all of their funds went straight to the gang members’ bank accounts.

As reported by Infosecurity back in 2021, the organized crime gang registered 250 domains to support its scheme and hired 100 staff to work in two call centers in Sofia to sell fake binary options.

Europol claimed that suspected gang members recently set up additional call centers in Bulgaria and Romania.

In the latest crackdown, police seized high-value assets including luxury watches, electronic equipment, cash, bitcoins, bank cards and various documents. An estimated 33,000 victims lost money to the gang.

Investment fraud cost victims an estimated $3.3bn in 2022, making it the highest-grossing cybercrime category that year.

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