Law enforcement agencies from Austria, Cyprus, and Czechia have arrested six Austrians responsible for an online cryptocurrency scam.

After performing six house searches, law enforcement seized over EUR 500 000 in cryptocurrencies and EUR 250 000 in fiat currency, and froze dozens of bank accounts. Furthermore, two cars and a luxury property worth EUR 1 400 000 were seized.

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Between December 2017 and February 2018, the scammers pretended to have set up a genuine online trading company that had issued a new cryptocurrency.

The initial coin offering (ICO) amounted to an offer of 10 million tokens – or respective rights to the new currency. Investors paid them in established cryptocurrencies such as Bitcoin or Ethereum.

To gain credibility with investors, the Austrian fraudsters also claimed to have developed their software and a unique algorithm for the sale of the tokens.

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