A Wellington-based man has been arrested in Auckland in connection with an international investigation into a cryptocurrency scam that allegedly defrauded victims of $265 million (NZD$450 million). The arrest was made by New Zealand’s Financial Crime Group, following an FBI-led probe into the operation.

Details of the Alleged Crypto Scam

Authorities revealed that the scam involved manipulating victims to fraudulently acquire cryptocurrency between March and August 2024. The stolen funds were reportedly laundered through multiple cryptocurrency platforms, making it difficult to trace.

Global Criminal Network Under Investigation

Over the last three days, search warrants were executed in three locations: Auckland, Wellington, and California, leading to the arrest of 13 individuals connected to the crypto scheme. Among the arrested is the Wellington-based suspect, who now faces charges under the U.S. Department of Justice.

Charges Against the Suspects

The charges include racketeering (RICO), conspiracy to commit wire fraud, and conspiracy to commit money laundering. Prosecutors allege that the stolen funds were used to finance an extravagant lifestyle, including:

  • Purchasing approximately $9 million worth of exotic cars.
  • Spending hundreds of thousands on luxury handbags, watches, and clothing.
  • Paying up to $500,000 per night for nightclub services.
  • Hiring private security guards.
  • Renting high-end properties in Los Angeles, the Hamptons, and Miami.

Legal Proceedings in New Zealand

After appearing in Auckland District Court, the Wellington suspect was granted bail and received interim name suppression. He is scheduled to reappear in court on July 3. This development highlights the growing international collaboration to tackle cryptocurrency-related crimes.

Additional Arrests and International Implications

The U.S. Department of Justice unveiled a superseding indictment that charges 12 additional individuals, including both American and foreign nationals, for their alleged involvement in the cyber-enabled racketeering conspiracy. Several arrests were made in California, while two suspects remain abroad and are believed to be residing in Dubai.

Timeline of the Alleged Criminal Enterprise

The operation reportedly ran from October 2023 through March 2025, during which members of the criminal network are said to have acquired a fleet of at least 28 exotic cars, valued between $100,000 and $3.8 million each.

This case serves as a reminder of the importance of vigilance when dealing with cryptocurrency investments. For beginners and intermediate investors, it’s crucial to research thoroughly, verify platforms, and remain cautious of manipulation tactics that scammers often employ.

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