The Federal Police of Brazil arrested one person last week in connection with a massive money laundering racket suspected of having moved $2.6 billion in illegal proceeds through crypto assets, the Brazilian edition of CNN reported.
Mastermind behind a Massive Money Laundering Operation
The person was arrested on January 7 at Guarulhos Airport in São Paulo when trying to board a flight bound towards Dubai in the United Arab Emirates. The person was living in Dubai to evade police actions, as UAE does not have an extradition treaty with most Western countries.
As outlined by the report, the arrested individual received the dirty money in Brazil generated from drug trafficking and other crimes and exchanged it for cryptocurrencies. The illegal proceeds were then funneled and moved through the accounts of several shell companies to hide their origin.
One of the involved shell companies handled $285 million of the dirty proceeds in merely ten months. None of these proceeds were declared to the tax authorities.
“There is also evidence that even living abroad, he continued to commit crimes, having identified a bank account belonging to a company owned by an intermediary and used by him to receive and transfer funds,” the Federal Police of Brazil stated (translated from Portuguese).
Operation Colossus
The arrest was part of a wider investigation initiated in 2022. This investigation aimed to uncover cases of tax evasion, money laundering, and other criminal associations linked to cryptocurrency trading between 2017 and 2021. Dubbed Operation Colossus, this operation spanned across several Brazilian cities and states, including Sao Paulo, Rio de Janeiro, and Minas Gerais.
Although the mainstream financial industry is adopting crypto, with the latest approval of Bitcoin ETFs in the US, digital currencies remain the favorite of criminals due to their decentralized nature. Over the years, law enforcement around the world have arrested and cracked down on several large-scale illegal operations using crypto.
Last year, the two founders of crypto mixing platform Tornado Cash faced criminal charges in the United States for assisting criminals, including hackers linked to the North Korea-linked Lazarus Group, to launder over $1 billion in illicit funds.
This article was written by Arnab Shome at www.financemagnates.com.
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