June 16, 2024

In France, Germany, and Spain, over 4,500 victims have lodged complaints in relation to dishonest individuals who established a crowd-funding initiative. The initiative sought investment of at least EUR 50 per individual towards the growth of medicinal cannabis plants. Unbeknownst to the investors, not a single cannabis plant was purchased. Instead, the scheme-makers feigned partnerships with legitimate and licensed companies to cultivate the plants. The fleece took place from January 2020 to July 2022.

This entire machination resembled a pyramid or ‘Ponzi fraud’ scheme, which promised enticingly high returns on investment. Investigations spearheaded in Spain and Germany, followed by additional countries across Europe, indicated that investors had only received partial payments.

Most of the capital raised was spent on affiliate payments, maintaining the scheme, and broadening the fraud via rigorous online campaigns. To achieve this and launder the funds, an international network of companies was utilized. A Russian criminal network appears to have been primarily responsible for overseeing the scheme with a related German-based crime group.

In Spain and Germany, victims claim losses amounting to EUR 51.5 million with the total investment being roughly estimated at EUR 645 million. Approximately 550,000 participants, a majority of whom were European citizens, signed up as online investors. Close to 186,000 participants transferred funds through either bank transfers or cryptocurrencies.

Eurojust has been prominently assisting national authorities since 2022. They have played a vital role in facilitating the French, German, and Spanish authorities in establishing and financing the JIT, leading to a triumphant Joint Action Day managed by Eurojust.

In the recent past, upon the request of the Spanish and German authorities, operations against criminal networks were executed in Estonia, Italy, Latvia, Malta, Poland, Portugal, the Dominican Republic, and the United Kingdom. French authorities played a crucial role in analyzing the cryptocurrency flows during investigations and participated in the searches in Germany and Spain on the day of action.

Europol has been instrumental in this expansive cross-border investigation from the outset, taking charge of operational coordination and offering customized analytical support. Additionally, they shared the findings of their financial investigations as well as other intelligence with the involved countries. On the day of action, Europol dispatched officers with mobile offices to various locations around the globe.

On the action days, over thirty locations were searched and multi-millions of Euros stored in cryptocurrencies and bank accounts were frozen. Among the seized items were real estate properties, expensive vehicles, works of art, cash, and various luxury items. Additionally, a significant number of electronic devices and documents were also confiscated.

The Operations on the Ground Conducted Requested by:

  • Germany: Berlin Public Prosecutor’s Office; Berlin Criminal Investigation Department (LKA)
  • Spain: Central Investigative Judge no. 6 at the Audiencia Nacional; Policia Nacional – UDEF Central Brigade against Economic Crime, Financial Fraud Group
  • France: Paris’ Prosecutor’s Office JUNALCO (National Jurisdiction against Organised Crime); Gendarmerie Nationale (Research Section Rennes)
  • Estonia: Office of the Prosecutor General; Police and Border Guard Board
  • Latvia: Prosecutor General’s Office; Central Criminal Police Department of the State Police, International Cooperation Department, and Economic Crime Enforcement Department
  • Italy: National Police’s Postal Police Service – Operational Section for Cyber Security, Macerata, Operational Centre for Cybersecurity of Marche
  • Malta: Malta Police Force – International Relations Unit
  • Poland: Public Prosecutor’s Offices – Jelenia Góra, Lublin, Warsaw, Warsaw Praga, and Wrocław; Central Bureau for Combating Cybercrime
  • Portugal: Central Public Prosecutor’s Office, Lisbon (DCIAP); Judicial Police (Policia Judiciária)
  • United Kingdom: National Crime Agency