Brazil: $193m ‘Crypto Pyramid’ Firm Declared Bankrupt
Indeal, the Brazilian company that was behind a crypto pyramid scheme estimated to be worth $193 million has declared bankruptcy.
In May 2019, the firm was central to a major police operation. Operation Egypt was the police’s name and they worked with the tax agency of the country to arrest Indeal-linked people. 25 addresses were searched by officers who confiscated valuable stones and expensive cars.
Police stated at the time that between 23,000 to 55,000 investors had invested in the scheme. Investors claimed that they were promised 15% within four weeks of their initial investment.
However, authorities claimed that the firm was operating without the necessary permits from the Brazilian Securities Commission and the Central Bank.
It is a suspected operator of crypto pyramids. Why did it declare bankruptcy?
In the aftermath of raids, the firm tried to remain afloat. The Federal Court granted permission to sell large amounts of bitcoin (BTC), seized during the raids. The court was granted the authority to auction BTC 3,537.21 and to use the funds to compensate victims.
The Brazilian government requested that the United States Department of Justice seize $25.7 Million worth of crypto from US-based wallets. This was done late last year.
This appears to be the end for Indeal. Brazilian-language media outlet Criptofacil According to reports, the Rio Grande do Sul Regional Business Court declared the company bankrupt.
This means that there are no more financial claims against Indeal. The bankruptcy proceedings have been completed and Indeal’s assets, including real estate, vehicles, financial assets, have been taken over by the court.
Indeal will also need to defend against lawsuits that were filed before it declared bankruptcy.
Police shut down an alleged crypto pyramid scheme that involved a token called Mindexcoin last year. The scheme was believed to have raised $769 million in investment.
Police believe that the project was overseen by a prominent individual known as the “Bitcoin sheikh”.