A bogus online German investment platform that defrauded victims for at least € 15m has been taken down as part of a major international law enforcement collaboration involving Eurojust, the agency of the European Union for cooperation in criminal justice and Europol.
Eurojust, the European Union Agency for Cooperation in Criminal Justice Matters, is a platform based in The Hague, the Netherlands, where national judicial authorities work closely together to combat serious cross-border organized crime.
German, Bulgarian, Cypriot, Dutch and Ukrainian authorities have all been implicated in supporting the removal of the platform which investigators believe could bring the total amount of fraud to around € 500m, said Eurojust in a press release.
Investigators estimate that the total amount of fraud could even amount to around 500 million euros. ”
The prime suspect ran a professional looking so-called binary options trading site that forecast high profits, he said.
After the initial investments, the victims were encouraged to put more into the alleged investment fund, losing all of their money. During a day of action, a suspect was arrested and eight locations searched.
The scammers operated between May 2019 and September 2021 and were successful in attracting mainly German investors with online and social media ads.
After the first contact, the clients were approached by so-called financial advisers, who showed fake online graphs of rising profits.
To this end, call centers have been set up in Bulgaria, Cyprus and Ukraine, with German-speaking operators. In addition, a system of special algorithms and more than 250 domain names and servers were used to cover up the scam.
As soon as the investors requested payments, they were put off by various excuses or were transferred to other call center staff.
In reality, no money was returned and the profits were passed on to the authors, using a series of companies created for this purpose.
Investors have been swindled for at least 15 million euros. Investigators estimate that the total amount of fraud could even amount to around 500 million euros.
Binary options are high risk financial instruments, with fixed amounts of money usually provided as reimbursement or other underlying securities used as collateral. They are often used in theoretical asset valuation, but are prone to fraud and often used in online scams to attract investors with allegedly high profit rates.
To assist the day of action, Eurojust set up a coordination center and participated in the exchange of cross-border judicial information between all the countries concerned. In addition, the Agency provided support for the execution of European arrest warrants. Europol has enabled an operational task force to assist the national authorities involved in the actions and the agents deployed on site.
The operation was carried out on the ground by the following authorities:
- Public Prosecutor’s Office (PPO) of Göttingen; OPP Rostock; Central criminal investigation
- Brunswick Department; Rostock Criminal Investigation Department
- Bulgaria: Office of the Specialized Prosecutor (SPO), coordinating and directing the activities of the specialized investigative service attached to the SPO; General Directorate of National Police
- Cyprus: Prosecutor’s Office, Anti-Money Laundering Unit; Ministry of Justice; Police, Headquarters of the Criminal Investigation Department of Cyprus
- Netherlands: Office of the National Prosecutor for Financial, Economic and Environmental Crime; Dutch tax police (FIOD)
- Ukraine: Office of the Prosecutor General; Kiev City Prosecutor’s Office; Ukrainian National Police Cyber Police Department; Kyiv City Shevchenkivskyi District Police Division