🌎 Brazilian Police Bust $88.6M Crypto Money Laundering Operation

Civil police in Brazil’s Sao Paulo have cracked down on a money laundering operation leveraging cryptocurrencies, run by the Primeiro Comando da Capital, a notorious drug gang.

The PCC gang operated a cryptocurrency exchange that facilitated their money laundering efforts amounting to more than $88.6 million USD, approximately 500 million Brazilian reais. The firm was registered in the name of a 23-year-old woman, reportedly the daughter of a city council candidate for Mogi das Cruzes.

During the raid, 55 million reais worth of checks were also seized from the company’s headquarters. The funds laundered using cryptocurrencies would be used to finance organized crime during the 2024 municipal elections. So far, authorities have arrested 13 individuals linked to the scheme.

Cryptocurrencies and Crime in Brazil

Cryptocurrencies have long been used as a tool by criminals and gangs in Brazil. Earlier this year, the Brazilian federal police dismantled a $2.6 billion crypto-powered money laundering operation.

In June 2023, the Special Department of Federal Revenue of Brazil raided six local cryptocurrency exchanges that had allegedly laundered $380 million worth of dirty money. Later that year, a UK-based individual came under investigation for using cryptocurrencies to launder drug money via the crypto exchange Binance. The funds were reportedly linked to Sérgio Roberto de Carvalho, an Interpol most wanted, often referred to as the “Brazilian Pablo Escobar.”

Regional Trends

The trend has been observed beyond Brazil among several criminal organizations across Latin America, including notorious cartels like the Mexico-based Sinaloa Cartel and Central America-based MS-13.

Despite the growing use of crypto in illicit activities, adoption in Brazil hasn’t slowed down. The country witnessed a 30% surge in crypto trading volume in 2024. The nation’s central bank is expected to present digital asset regulations this year.

Market Adoption

Capitalizing on the demand, Brazil’s largest bank, Itaú Unibanco, allowed the trading of Bitcoin and Ethereum on its mobile app on June 12. In March, asset manager BlackRock launched its spot Bitcoin ETF product in the nation.