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Hungary busts massive Israeli-led fraud and money laundering ring

Promising ‘good returns’ on cryptocurrency investment, gang cheats victims out of tens of millions of dollars; less than $2 million recovered so far

A visual representation of Bitcoin, at the 'Bitcoin Change' shop in Tel Aviv, February 6, 2018. (Jack Guez/AFP)
A visual representation of Bitcoin, at the 'Bitcoin Change' shop in Tel Aviv, February 6, 2018. (Jack Guez/AFP)

Hungarian police busted an international money-laundering ring based in Hungary earlier this month that was led by an Israeli man that cheated people in dozens of countries through online investment frauds, police said Monday.

Around 44 million euros ($47 million) were transferred from some 94 companies set up by the gang, police spokesman Peter Farkas told reporters in Budapest.

The gang was led by a 48-year-old Israeli man living in Hungary, one of five suspects arrested during coordinated raids on May 9 across Hungary.

The fraud schemes were typically online and related to so-called “account-switching” and cryptocurrency investments, said Farkas, speaking at a press conference where seized phones, laptops and some 250 SIM cards were on display.

Cars and jewelry were also confiscated.

“Investments with good returns were promised to people who then transferred monies to over 400 fraudulent bank accounts,” he said.

The money was “quickly transferred onward,” mainly to countries east of Hungary, said Farkas, without specifying where.

Police have so far recovered some 1.8 million euros ($1.94 million) from the 44 million euros, he added.

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