In a quest to stop activities of money laundering in the state using crypto exchanges, the Brazilian civil police have seized R$172 million ($33 million in US dollars), from different exchanges.
Brazilian police executed six search warrants during the “Exchange” investigation in Sao Paulo and Diadema, following which the Brazilian judiciary ordered freezing accounts and confiscating assets from two persons and 17 entities, according to an official statement that did not name them.
Crypto exchanges bought and sold bitcoin to fictional firms created to provide their creators access to the banking system, according to the probe.
According to the authorities, one of the exchanges traded $1.93 million in digital assets with six phoney firms over a five-month period, while eight other bogus organizations bought $2.9 million in cryptocurrency.
According to Brazilian police, the exchanges did not examine the authenticity of the businesses they interacted with or the origins of the transactions, and they deliberately functioned on behalf of a criminal organization dedicated to money laundering using cryptocurrency.
Money was routed to offshore firms and then repatriated by faking sales or service-provision transactions, according to the probe.
According to preliminary investigations, the organizations conducted big transactions among themselves before routing money to middlemen in charge of acquiring digital assets and delivering a hash code to their clients.