A fraudulent pyramid scheme was taken down by authorities from Germany, Switzerland, Austria, Czechia, Lithuania and Liechtenstein, with the support of Eurojust and Europol. The organised crime group (OCG) used an investment model that focused on the leasing and subleasing of cryptocurrency machines, such as exchange machines and hardware for mining. The suspects were able to target thousands of victims, causing losses of up to EUR 113 million. During an action day on 11 June, six arrests were made, 29 searches were conducted and the suspects’ assets were frozen.
The advertised investment concept involved the leasing of cryptocurrency products, such as investments in server storage for internet cloud services and the subleasing of crypto exchange machines. The suspects promised returns of 70% before tax to those joining the scheme. Investigations by German authorities showed that the promised returns were not only unrealistic, but also impossible, as the leased equipment and systems allegedly did not exist.
As the promised investment scheme did not exist as advertised, the suspects created a pyramid scheme, where most of the revenue for earlier investors came from more recent investors. The funds collected were not used for the promised investments, but mainly for the suspects’ living expenses. Throughout the scheme, the suspects concluded thousands of contracts, earning up to EUR 113 million.
As soon as the fraudulent scheme was discovered by German authorities, two coordination meetings were held at Eurojust to exchange information and evidence with authorities from Germany, Switzerland, Austria, Czechia, Lithuania and Liechtenstein. To ensure a continued smooth cooperation, a joint investigation team (JIT) between German and Swiss authorities was set up with the support of Eurojust.
The cooperation between authorities resulted in an action day on 11 June, with the involvement of over 280 officers on the ground. The actions resulted in six arrests, 29 searches, the seizing of evidence, and the freezing of several assets. Due to the coordination between the authorities, and the use of Eurojust’s facilities, simultaneous actions were carried out in Germany, Switzerland, Austria, Czechia, Lithuania and Liechtenstein.
The following authorities were involved in the operation:
- Germany: Public Prosecutor`s Office Erfurt, Criminal State Investigation Office Thuringia
- Switzerland: Public Prosecutor’s Office of the Canton of Zurich
- Austria: Central Public Prosecutor`s Office for Combating Economic Crimes and Corruption
- Czechia: Municipal Public Prosecutor´s Office in Prague; Regional Directorate of Police of the Capital City of Prague
- Lithuania: Vilnius Regional Prosecutor’s Office
- Liechtenstein: Princely Court of Justice of Liechtenstein
