$22 Million Bitcoin Scam attempted by Brazilian Officials: Arrested
Police authorities in Rio de Janerio have revealed a money laundering scheme in which state authorities carried off money planned for prison supplies, utilizing bitcoin to trade some of the proceeds.
The scam included misquoting the budget allowance spent on food for state-run prisons, basically redirecting reserves worth $22.4 million – however, just a small portion of the total was changed into bitcoin.
As per a regional report, warrants were issued to inspect 28 sites, with seven individuals have being held up until now. Previous police chief Marcelo Martins and the former head of the state prison system, Cesar Rubens Monteiro Carvalho, were jailed in connection with the racket on Tuesday.
Warrants have also been distributed for several other suspects. One of the state officials said the scheme was created by former Rio de Janerio governor Sérgio Cabral, who was convicted to 14 years in prison in 2017 for charges that included corruption and money laundering.
According to the reports, money laundering scheme has been going on since 2001, long before some of the members started changing cash into bitcoin.
Luiz Henrique Casemiro, the Superintendent of the Internal Revenue Service in Rio de Janeiro also shared their opinion.
“We drew attention, in the Federal Revenue, regarding this specific operation, because for the first time [the] operations [involved] bitcoin. … [There] were remittances made with the purchase of bitcoin.”