Researchers reveal how cryptocurrencies are being used by scammers and criminal organizations in Brazil

Technology can be used for good or ill. In Brazil, scammers and criminal organizations are ahead of the law and police officers and have taken advantage of the tools to manage the resources provided by blockchain technology and cryptocurrencies to move the money from illegal activities, reported by Correio do Brasil.

A Federal police officer who did not want to be identified for security reasons told the report that “cryptocurrencies have replaced traditional currency converters”. These underground money market companies have classified financial transactions in currencies through their relationship with the financial system in order to hide the origin of dirty money obtained from illegal activities.

Currently, the official explains, criminals choose to obtain cryptocurrencies that can run alongside the financial system through unsecured wallets, due to the decentralization of blockchain technology:

“It’s easy to carry, it doesn’t need to be in a bag, they use a ‘hardware’ bag, or ‘hardwallet’, like a flash drive, but it can store billions of reais in crypto assets , if it’s a digital asset, doesn’t respect borders”.

Although the data stored on blockchain networks is public and transparent, which means that it can be accessed and viewed by any authority or person, it is very difficult to recover the funds stored in it. cryptocurrencies, the Federal District Military Police Major told the report. Herbert Rodrigues.

Today, only companies specializing in cryptocurrency analysis, such as Chainalysis, for example, can identify activities and users quickly and efficiently. Chainalysis often uses it to interact with international authorities, but its work in Brazil is not important.

In Brazil, investigators and police do not have the knowledge and resources needed to make efforts to directly identify illegal activities on blockchain networks.

Of particular importance is the increased effort to increase the investigative capacity of the Brazilian police in recent years. However, he said, they fall short of what is needed to face most of the groups that use cryptocurrencies to move and store their assets.

Recently, an investigation by the Federal Police was able to eliminate a group accused of carrying out a financial pyramid scam in Itajaí (SC) that injured about 120 people, hurting them about R $ 15 million.

According to the investigations, the main company involved in the project started its activities in 2019 as a bank, without the approval of the Central Bank and the Securities and Exchange Commission (CVM) . According to the source, the company worked through false promises of profits above the market average and, as a result, increased financial resources through bank accounts and cryptocurrency trading. .

The accused, whose names were not revealed at the time, are responsible for crimes of criminal organization, theft, money laundering and crimes against the public financial system. So far, the resources have yet to be identified.


The sources questioned by the report show that cryptocurrencies have become a tool for the transfer of voluminous financial assets from Brazilian criminal organizations such as the PCC (Primeiro Comando da Capital) and the Comando Vermelho.

In February this year, two members of the PCC were killed after losing BRL 200 million in cryptocurrencies. According to the investigations of the Civil Police of São Paulo, Cláudio Marcos de Almeida, known as Django, and Anselmo Fausta established a system of extorting money based on cryptocurrencies with entrepreneurs in the field. When CCP leaders struggled to get the money back, they ordered the two killed.

Major Rodrigues believes that the total amount of money held by the criminal organization in crypto assets will be higher, because they will facilitate money exchanges with other international cartels. He also said that the PCC has already invested in the training of the members of the specialized team in cryptocurrencies:

“We cannot see the PCC as a criminal organisation. They are an organized professional organisation, with many divisions within the criminal organisation. They have brought together lawyers to provide legal aid , about drug trafficking and helping families. has been known to pay cryptocurrency bills [para aprimorar técnicas de integrantes]with people with the police.”

In addition to the tools for hiding and moving large amounts of money, the distribution of cryptocurrencies by criminals uses two fundamental gaps: the lack of a regulatory framework to establish the rules governing the operation of the unit and the lack of training by internal authorities. fighting criminal activities, related to cryptocurrencies, said Major Rodrigues.

Courtesy of justice

Bill (PL) 4.401/2021 is the first step by the political class to try to regulate the cryptocurrency market in Brazil. However, the PL was held in the Chamber of Deputies after being approved by the Senate in April of this year.

The text aims to increase the punishment for money laundering using crypto-assets and prevent companies from operating in the field without permission from the relevant authorities.

The author of the program, the deputy Áureo Ribeiro (Solidariedade-RJ) criticized the delay of the vote in the opinion that, according to him, left the market “in the dark”:

Without justice, people have nowhere to turn. “

The report heard that Professor Guilherme Forma Klafke, a researcher at the Center for Teaching and Research in Innovation (CEPI) of the Law School of São Paulo of Fundação Getulio Vargas (FGV), believes that the project is important to create guidelines for the work of the companies that work in the market. However, even though it was approved in the Senate, the bill is incomplete and may leave gaps in the law.

The expert explained that the PL refers to virtual assets that are used as a means of payment and forms of investment, such as Bitcoin, but did not look at the latest market developments, such as non-fungible tokens (NFTs):

“We don’t know if NFTs and tokens made in games, for example, are considered investments or not. I can claim that I bought an NFT and say that it is not investment. In this way, these assets will escape. monitoring to prevent future errors.”

Klafke also criticizes the fact that the text does not establish regulatory bodies that are responsible for the creation of specific laws related to the sector, although the PL is a basic one. After being approved in the Office, the Director must explain by order that he is the regulatory body of the final result.

The Central Bank, the Securities and Exchange Commission (CVM), the Federal Revenue and the COAF (Council for the Control of Financial Activities) have already expressed their opinion on the subject and therefore there is a problem to fight these bodies. said the sage.

Despite the recent association of cryptocurrencies with crime, criminal lawyer, expert in Economic Criminal Law, and author of the book “Bitcoin and Money Laundering – When a transaction constitutes a crime”, Felipe confirmed Américo Moraes in an interview with Cointelegraph Brasil was there. Today, the research and analysis activities and tools can be used to change the data, identifying the tools that are involved in the routine activities in the most important way.

According to Moraes, over the years these aspects of monitoring the transaction will grow and make the cryptocurrency market more monitored and controlled than it was.

It is also worth noting that in 2021, cryptocurrencies used in criminal activities in Brazil were less than 1% of the total BRL 707 billion in transactions related to criminal money.

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