Madrid Criminal Organization Dismantled After Massive Financial Fraud Operation
The National Police, in collaboration with Customs Surveillance of the Tax Agency, has successfully dismantled a criminal organization based in the Community of Madrid, which was engaged in extensive financial fraud schemes. According to a statement from the Ministry of the Interior, the confirmed financial losses reported by the 29 identified victims exceed 2 million euros, while the total amount of fraud linked to the organization has surpassed an alarming 52 million euros.
Following months of investigation, authorities executed 12 searches on November 20 at various homes and offices located in Madrid, Rivas Vaciamadrid, and San Sebastián de los Reyes. During these operations, law enforcement seized approximately 200,000 euros in cash, four vehicles, over 40 mobile phones, 12 high-end watches, computer materials, and 21 pieces of art and facsimiles valued at more than 200,000 euros. As a result of the operation, 33 Spanish individuals aged between 19 and 40 have been arrested and are facing serious charges including fraud, money laundering, and participation in a criminal organization.
The criminal organization operated with a hierarchically structured system. The investigation, which commenced at the end of 2023, was triggered by multiple complaints from individuals who had entrusted their capital to platforms purportedly managed by an international broker, only to lose all their investments with no means of recovery.
Authorities highlighted that the organization’s leadership was composed of individuals at the top responsible for defrauding more than 52 million euros between 2017 and 2024. Below them, an intermediate group handled logistics and administration, managing the resources and infrastructure crucial for executing the scams. At the base of the organization, recruiters, also known as salespeople, were assigned the task of luring victims, primarily targeting small savers lacking financial acumen by enticing them with promises of 30% returns while downplaying the associated risks.
The modus operandi of the organization involved recruiters contacting potential victims from makeshift call centers, which were often set up in their residences. They would offer what appeared to be secure investment opportunities. However, any funds that were collected never converted into actual investments. Instead, the capital was split between a foreign broker and the members of the Spanish organization, who shared the proceeds on a 50/50 basis.
This sophisticated scheme blatantly violated regulations set forth by the National Securities Market Commission (CNMV), as the victims were not adequately informed about the actual risks involved in their supposed investments and were continuously misled with unattainable promises of high profitability that never materialized.
Authorities continue to investigate the depth of this financial fraud and are working diligently to ensure that the victims of this fraudulent scheme regain some of their losses as the judicial process unfolds.
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