Israel Arrests 3 in Crypto Scheme to Launder Millions Stolen From France

August 17, 2022

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Israeli police have arrested three suspects who allegedly stole millions of euros from the French treasury through cryptocurrency transactions. The money comes from government grants to businesses affected by the Covid-19 pandemic. Three people were arrested in Israel this week on suspicion of providing money laundering services to criminals defrauding the French government. The English-language newspaper The Times of Israel and major local media reported that the move was the result of an undercover investigation by Israel’s special anti-crime unit Lahav 433. According to the publication, authorities believe that the detainees used various digital currencies to launder millions of euros, which were then returned to French clients and reimbursed to Israelis. Several other suspects have also been questioned as part of efforts to uncover the plot.

In addition to Lahav 433, the Yahalom investigative unit of the Israel Tax Service and the cybercrime and international crime unit of the prosecutor’s office were also involved in the work. Reports describe Israeli police working closely with their French counterparts and the European Union’s agency for police cooperation (Europol). The French opened an investigation last year, and the Israelis began working on the case in 2022. In 2020 and 2021, when the European economy was affected by the quarantine, fraudsters in France benefited from the state support for companies affected by the negative effects of the Covid -19 pandemic. The French organizers of the robbery set up shell companies and were able to receive compensation claims issued by the government. Paris wants to quickly spend funds to provide relief to financially distressed and unregulated businesses. They then used the money laundering services of arrested Israelis, who bought digital currencies with money and exchanged them for several currencies, hiding the original source of the funds and eventually buying them in fiat currency. Police officials declined to explain how the system works, but promised to provide more details soon.

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