‘King of Bitcoin’ Arrested in Brazil Over $300 Million Scam

Reading Time: 2 minutes
  • The so-called ‘King of Bitcoin’, Cláudio Oliveira, has been arrested in Brazil
  • Oliviera was president of the Bitcoin Banco Group which claimed it lost 7,000 BTC in 2019
  • Bitcoin Banco Group turned out to be a criminal enterprise that took some $300 million from victims

A man labelled the ‘King of Bitcoin’ has been arrested in Brazil over a suspected $300 million fraud. Cláudio Oliveira, who served as president of popular finance firm Bitcoin Banco Group, was arrested yesterday on several charges including money laundering and fraud following an 18-month investigation. In 2019 Bitcoin Banco Group tried to claim compensation for 7,000 bitcoin alleged to have gone missing but failed to provide information to support the claim. This led to a police investigation which found that Oliveira had in fact diverted funds to himself.

Bitcoin Banco Group Claimed 7,000 Bitcoin Was Lost

Bitcoin Banco Group reported the missing 7,000 bitcoin in late 2019 where they applied for a judicial recovery order, which allows companies in financial trouble to reorganize its finances and administrative affairs so that it can pay off creditors and avoid bankruptcy. However, Oliveira failed to hand over crucial information on the ‘lost’ bitcoin, such as how and where it was stored and details of the theft itself. Bitcoin Banco also continued to operate as if nothing had happened, assuring clients that their bitcoin was there.

Police Raid Uncovers Riches

Police, becoming suspicious over the claim, did some digging on Oliveria and found he had previously been under investigation in Europe and the U.S. This led to the formation of Operation Deamon, which looked into the affairs of Oliveira and Bitcoin Banco Group more closely, and in which some 90 officers took part. It concluded that far from the funds being taken by a third party they were siphoned off by Oliveira himself, and moved to arrest him.

The raid on Oliveira’s premises at the time of the arrest led to police seizing luxury cars, large amounts of cash, cryptocurrency hard wallets, and more, suggesting that he did indeed know full well where the funds had gone. Bitcoin Banco Group has now been classed as a criminal organization, and Oliveira faces many years behind bars if found guilty.