Spanish authorities have dismantled a sophisticated criminal network accused of orchestrating a global, AI-driven investment scam that defrauded over $20 million from at least 208 victims.
According to an April 7 statement from the Spanish National Police, six individuals were arrested for their involvement in the elaborate scheme, which exploited deepfake technology and artificial intelligence to execute multiple layers of deception.
The Fraudsters targeted victims through online ads featuring altered videos of public figures promoting fake crypto investments, promising high returns with no risk. Spanish authorities reported that algorithms were used to identify those most vulnerable based on their online behaviour. Once victims invested, they could not withdraw their funds, often realizing the scam too late. The scammers then contacted victims under different pretences, first posing as investment managers claiming funds were frozen unless a deposit was made, and later as Europol agents or UK lawyers, claiming that taxes needed to be paid to retrieve their money.
Police said the scheme was supported by a web of fake companies created to launder the stolen funds. During a raid on the operation’s alleged leader, officers confiscated multiple mobile phones, computers, hard drives, false documents, and a simulated firearm. Authorities revealed that the mastermind behind the scam used over 50 different identities to mask his tracks.
The suspects now face charges of fraud, money laundering, document forgery, and participation in a criminal organization. Investigations are ongoing, as authorities have identified several other individuals linked to the plot across international borders.
In February, blockchain analytics firm Chainalysis highlighted the generative AL scam trend in its Crypto Scam Revenue 2024 report, highlighting the increased scalability of AI-enhanced fraud operations.
Additionally, The North American Securities Administrators Association (NASAA) has issued a stark warning about the growing threat of cryptocurrency and social media scams, emphasizing the increasingly deceptive tactics used by fraudsters to exploit investors.
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