Brazil shuts down scheme that defrauded 55,000 investors

Laos cbank warns against using cryptocurrency

Brazillian police have arrested ten people suspected of operating a cryptocurrency pyramid scheme worth 850 million reals ($210 million).

As part of Operation Egypto, a swoop dedicated to unearthing unsanctioned financial schemes, Brazil's tax agency joined police in orchestrating a crackdown on the figures behind Indeal, who they say amassed funds from 55,000 investors.

They lured victims with the promise of a 15% payout in the first month after investment in the crypto scheme.

In total, the investigation involved inspection of 13 individuals and five legal entities. "The problem with this company is that it was acting without authorization," Correido Do Povo quotes Delegate Eduardo Dalmolin Boliis of the federal police's Office of Corruption and Financial Crimes as saying. Bearing the signs of a classic financial pyramid, confiscations of assets belonging to the figures involved showed that Indeal would not be able to service withdrawals from all its investors at once.

They also used investments to pay for luxury items, authorities said, including 30 cars and precious stones that were subsequently confiscated.

The news comes the same week as the United States took action against a Ponzi scheme network tied to a cryptocurrency that was claimed to be backed by diamonds. In this instance, the leaders of the network reportedly duped domestic and foreign clients into handing over around $30 million over several years. Cryptocurrency use is not illegal in Brazil, with the police taking pains to reiterate the impetus for the Indeal raid was the lack of legality behind its business. As Cointelegraph reported, Brazilian police had conducted another operation on a cryptocurrency drug ring in April.

The central bank of Laos has warned the public against the use, purchase or sale of digital currencies.

The Bank of the Lao PDR has issued a warning to financial market participants and the public against cryptocurrency transactions as they are considered illegal in the country. The bank previously banned financial institutions from conducting any operations with cryptocurrencies, as well as making investments in such an asset.

The bank is purportedly concerned about the anonymity of the sender and receiver in a cryptocurrency transac

tion, which it worries increases the risk of digital assets' use in money laundering. A source familiar with the matter told Vientiane Times that authorities do not have a relevant security system to protect cryptocurrency owners.

While some countries like, Canada, Malta and Switzerland have embraced the new asset class to vary

ing degrees, officials around the globe are still expressing skepticism toward crypto, while some hardliners call for outright bans.

In the United States, where the legal status of crypto can vary state-tostate, California Congressman Brad Sherman recently called for a full ban on cryptocurrencies. Sherman claimed

that crypto presents a threat to the power of the U.S. dollar to affect world economic developments.

In April, Cointelegraph reported that the Indian government was considering a complete ban of cryptocurrencies under the Prevention of Money Laundering Act since it could purportedly be used for money laundering.