Ukraine and EU unite to smash crypto crime ring

Police from across Europe have joined forces to shut down an online cryptocurrency scam that defrauded victims out of millions of euros.

Authorities from EU member states, Ukraine, and Georgia acted in concert, swooping in on properties in the latter countries this week to seize computer equipment and cash, as well as freezing bank accounts in more than 20 countries. It’s not clear if any arrests were made.

Most of the victims of the scam were would-be digital currency investors based in Germany and Switzerland, who were fooled by a network of more than a hundred bogus websites and con artists posing as customer service agents into putting their money into fake investments.

Acting on a request from Swiss authorities, the EU criminal justice body Eurojust coordinated the operation that involved police in European countries as far-flung as Lithuania, Portugal, Germany, and Cyprus.

But the bulk of the groundwork was done in Georgia and Ukraine – working hard to clean up its reputation as it applies for EU membership in the face of Russian aggression – where the fraudulent call centers were based.

“In order to communicate with potential investors, fraudsters created call centers in Ukraine and Georgia,” said the Cyber Police of Ukraine, who were involved in the crime swoop.

It added: “Several hundred people worked there. Extras selected operators with knowledge of foreign languages ​​and taught them to use social engineering methods when communicating with ‘clients.’ Scammers convinced citizens to make significant investments.”

Victims lost millions

Eurojust said that “given the complexity and scale of the scam” it was difficult to estimate the true cost to victims but that it ran to “at least several million euros.”

“The perpetrators allegedly used over a hundred websites, posing as serious investment companies, offering financial transactions in cryptocurrencies and trading options,” it added. “After potential investors showed interest, they were approached over the phone and lured into making considerable investments that were subsequently lost.”

The Cyber Police of Ukraine added: “Also, victims were persuaded to install special software to carry out financial transactions. In this way, fraudsters gained remote access to victims' computers and transferred their savings to controlled accounts.”

The investigation began in 2019 and got back on track late last year after being temporarily suspended due to Russia’s invasion of Ukraine.

Europol’s financial and economic crime division provided analytical support, while the European Cybercrime Center helped coordinate the countries involved, which also included Hungary, Belgium, Bulgaria, Czechia, and Slovakia.