The Brazilian Federal Police and the Brazilian Tax Authority have launched the latest stage of “Operation Colossus,” a movement that has enforced hundreds of court orders against cryptocurrency exchanges, arbitration agents and bogus companies in four states of the country. 158 government agents, including 130 federal police officers, were involved in this operation, issuing search and seizure orders for six cryptocurrency exchanges and four foreign exchange institutions.
Operation Colossus launched to stop crypto money laundering operations
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On September 22, the Federal Police of Brazil, with the help of the Brazilian Tax Authority, launched the final stage of Operation Colossus, an investigation with more than four years of history. The organizations have enforced more than 100 court orders directed against six cryptocurrency exchanges, four exchange operators and arbitrators suspected of assisting in money laundering operations.
An estimated 130 federal police took part in Operation Colossus, issuing two arrest warrants and 37 search and seizure orders in four states across the country, including Rio de Janeiro, Bahia, Sao Paolo and Santa Catarina. 28 agents from the Brazilian tax administration were also involved in the effort.
The criminals allegedly used cryptocurrency assets to launder money through a funds transfer system. According to the statement from the federal police, nearly $391 million was misplaced in suspicious foreign exchange transactions. The Federal Police said:
These resources entered and circulated in the official financial system, through front companies, without economic and financial capacity, and transited through transit accounts until their conversion into crypto-assets usable abroad.
Modus Operandi and similar operations
Authorities believe that three groups were involved in this criminal enterprise. The first group is made up of high-level arbiters, who have purchased large amounts of cryptocurrency assets in countries like the United States, Singapore, and Hong Kong. The second group is cryptocurrency exchanges, which acted as intermediaries.
The third group is made up of fake companies and people who have purchased these cryptocurrency assets, with many customers unable to purchase cryptocurrencies. These included people who had died, people included in assistance programs and people over the age of 90. More than 1,300 of these bogus companies were managed by a single accountant.
It is one of the largest crypto operations of its kind in the country, alongside others like Operation Kryptos and Operation Compliance, which were carried out by government forces last year.
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Brazilian Federal Police Launches Operation Colossus, 6 Cryptocurrency Exchanges Involved
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