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Brazilian authorities have exposed a massive $9.7 billion money laundering operation involving cryptocurrencies, leading to arrests in several cities, including São Paulo, Fortaleza, and Brasília.
In an operation dubbed “Operation Niflheim,” Brazil’s Federal Revenue and Federal Police carried out 23 search warrants and eight arrests. This crackdown targeted a network accused of using cryptocurrencies to launder money from criminal activities, such as drug trafficking and smuggling.
The investigation revealed two companies in Caxias do Sul as central players, moving R$19 billion (approximately $3.6 billion) and R$15 billion ($2.8 billion) between August 2019 and May.
The scheme consisted of four layers, including tax evaders, shell companies, and businesses handling foreign exchange and crypto transactions. The laundered funds were then sent to countries like the U.S., Hong Kong, and the UAE.
Authorities discovered that more than half of the deposits linked to the primary suspects were from individuals with criminal backgrounds, showing the widespread use of cryptocurrencies for illegal activities.
A federal court has frozen $1.58 billion in assets held in bank accounts and cryptocurrency exchanges, although the specific platforms were not named. Since the investigation began in 2021, over $9.7 billion has been laundered, highlighting the growing role of cryptocurrencies in financial crimes in Brazil.
