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Authorities Detain Dutch Legal Academic Linked to $4.6 Million Cryptocurrency Financing Operation
The police in the Netherlands have detained a 24-year-old law student on suspicion of orchestrating a multi-million euro cryptocurrency scheme. The alleged crypto trader from Hengelo is accused of defrauding nearly 300 investors, misappropriating €4.5 million ($4.6 million).
The suspect was targeted by law enforcement last year after his cryptocurrency trading operation failed. The self-proclaimed ‘crypto banker’ reportedly went into hiding following harassment from investors, according to local media outlet Oost Nieuws.
Police spokesperson Chantal Westerhoff confirmed the arrest earlier this week, as noted in the report. Dutch authorities also conducted a search at his residence on Monday.
Further investigations by the judiciary indicated that there was intent involved in the cryptocurrency scheme.
The Crypto Investment Scheme Collapse
The investment scheme initially generated substantial profits, and the individual was regarded as a cryptocurrency expert, the report stated. Being a skilled footballer himself, he also received significant amounts of money from numerous local football players.
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In 2024, the accused and his brother sent an email to nearly 300 investors. To their dismay, he disclosed that all their investments in the scheme, including his own funds, had been lost.
In the aftermath of the collapse, hundreds of investors came together at the Stichting Onderzoeks Collectief Hengelo to file a complaint against him, led by attorney Arjon Tieman of Damsté and Partners.
The police received various pieces of evidence from victims in the preceding weeks, which led to his arrest. One victim has alleged that the individual continued to attract investors even after the failure of his investment scheme.
As a result, lawyers have accused the student of operating a cryptocurrency Ponzi scheme, utilizing funds from new investors to pay earlier ones.
The fraudulent scheme required a minimum investment of €5,000 ($5,146), from which he took 50% of the profits as fees.
“The Hengelo man will be extensively questioned in the coming days,” the police confirmed.
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