Brazilian Federal Police Tracking Crypto to Combat Money Laundering

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In Brief
  • Brazilian Federal Police have carried out more than 30 search and seizure warrants to combat money laundering via cryptocurrency.

  • Additionally, numerous bank accounts and cryptocurrency wallets were frozen as a result of ties to criminal activity.

  • Brazil recently seized more than $30 million in laundered money that was using cryptocurrency exchanges as cover.

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A new operation was launched by Brazil’s Federal Police force with the goal of shutting down money-laundering operations. 

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The Brazilian Federal Police released a statement on Thursday detailing its new plan to combat money laundering crimes. The investigation, named ‘Operation Compliance,’ saw more than 150 federal police officers carrying out more than 30 search and seizure warrants across the nation. The targets were in the cities of Goiânia, Campo Grande, São Paulo, Laranjal Paulista, Recife and Vitória. The investigation had been ongoing since 2018.

The operation was not only to execute the warrants, but also served to issue more than 30 orders to block certain bank accounts and crypto wallets by a Federal Court order out of Goiás. The individuals involved, or the total locked funds have not yet been released by the Federal police. 

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In 2018 when Operation Compliance began, Federal Police were able to identify the involvement of a hacker in electronic fraud online. The Federal Police says that “The scheme consisted in the diversion of bank account values ​​and the subsequent increase in profitable activity with investments in cryptocurrencies, generating substantial bank transactions through the investigated companies.”

Brazil busy with cryptocurrency crime

The news of Operation Compliance comes less than a month after around $33 million in funds were seized by Brazilian authorities in connection to a money-laundering ring. During the investigation, authorities executed six search warrants in the city of São Paulo and arrested a pair of offenders. On top of the two arrests, 17 companies saw their assets were frozen and an additional $33 million seized by the government.

The warrants were issued after investigators discovered fictitious companies were being used to buy Bitcoin before funneling funds to offshore entities to repatriate at a later date in the form of sales or services. 

The police state that the exchanges failed to property verify the legitimacy of its clients or look into the origins of transactions. Investigators also insinuated that the exchanges in question all had close ties to criminal organizations and the black market. Money laundering with cryptocurrency has been a hot-button topic in several countries including the United States, the United Kingdom, and China. The latter recently arrested more than 1,000 suspects on charges related to money laundering with cryptocurrency.

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Matthew De Saro is a journalist and media personality specializing in sports, gambling, and statistics. Before joining BeInCrypto, his work was featured on Fansided, Forbes, and OutKick. With a background in statistical analysis and a love of writing, he takes an outside-the-box approach to reporting news.

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