Former Botafogo executive arrested for creating a pyramid of cryptocurrencies

Former Botafogo executive arrested for creating a pyramid of cryptocurrencies

Rio de Janeiro’s civil police dismantled a financial pyramid on Wednesday morning (1). The company was investigated for offering investments with cryptocurrencies, financial applications and exchanges. A former Botafogo manager was arrested in the action.

According to the PCRJ, 11 search and seizure warrants and 1 arrest warrant have been served.

The case concerns Futura Invest, a scheme that has stopped honoring payments since 2021, when the first complaints surfaced in Brazil.

Former Botafogo executive arrested for creating financial pyramid with cryptocurrencies in Rio de Janeiro

The former chairman of Botafogo’s Supervisory Board has been accused of carrying out a coup involving cryptocurrencies since 2021, according to Livecoins’ investigation at the time.

Now under arrest, he must answer for crimes against investors after leaving a trail of losses in the national financial market.

According to the Fraud Bureau (DDEF), “dozens of victims were injured, causing the loss of millions of reais and so far one person has been arrested, documents and electronic devices seized“.

In a note, the PCRJ stated that two companies were used by the financial coup, with promises of high profits. One of them was Futura Invest, a company that had already submitted complaints from scammed investors via Advertising Aqui.

Fraud committed against officials and military in Rio

For the civilian police, everything indicates that the action acted as a criminal organization that promised high profits to the victims. The group’s targets were mainly civil servants and the military.

Thus, a service contract was finally signed with the customers, withstanding a prediction of a high return on invested capital.

To consolidate the coup, suspected companies paid the first installments of the fraud. After the promising start, however, the other promised installments were not paid, which is characteristic of financial pyramid fraud for the PCRJ.

Financial pyramids in the crosshairs of justice

The cryptocurrency market in Brazil received a lot of publicity among financial pyramids, companies that promise quick and high profits to unwary investors. Commitments include inviting friends and family, but are usually short-lived.

This is because the business model of financial pyramids is not sustainable. Before fraud involving cryptocurrencies goes unpunished, however, it needs to decline in Brazil.

According to the cryptocurrency law passed in December 2022 and coming into effect in June 2023, anyone caught committing crimes could face jail time in addition to paying a fine. For example, market investors hope that impunity in the market will come to an end, with pyramids in the crosshairs of justice.

Source: Live Coins