A major fraud trial involving crypto and diamond investments has been opened in France, with more than twenty defendants brought to trial on charges of defrauding 1,300 individuals and several top football clubs. According to local media, the proceedings began on October 21 at a conference center in Nancy, eastern France, due to the large number of claimants involved.
The suspects are said to have orchestrated a complex plan between 2016 and 2018 in which approximately 28 million euros were stolen from the victims. The operation involved creating fraudulent websites offering investment opportunities in diamonds and cryptocurrencies, luring investors with promises of high annual returns. One person reportedly lost €400,000 after investing in what was described as a ‘diamond savings scheme’.
According to Barron’s, the fraud extended beyond individual investors to a dozen professional football clubs. The defendants allegedly posed as players’ agents and contacted clubs to inform them of changes to players’ banking details. The clubs were then instructed to forward the salaries to new accounts controlled by the fraudsters. Clubs such as Sochaux, Angers and Toulouse fell victim to this tactic, collectively losing around €60,000.
The scale of the operation was extensive: it involved 199 bank accounts opened in 19 countries to facilitate the movement of money. Approximately 850 victims are represented in the lawsuit, some of whom invested a significant portion of their savings or even took out loans to participate in the supposed investment opportunities. The case was dubbed “red card” due to the involvement of football clubs among the plaintiffs.
As the European Union Agency for Judicial Cooperation in Criminal Matters reported in 2018, the fraudsters used sophisticated methods to carry out their plan. They approached victims by expressing interest in acquiring commercial companies and building trust before convincing them to install crypto wallets. After the wallets were set up, the suspects allegedly stole the money. The use of crypto enabled rapid and difficult-to-trace transfers across borders, complicating authorities’ efforts to track the flow of money.
The legal proceedings will last four weeks, with 22 defendants facing charges ranging from criminal conspiracy to fraud committed in a gang. About a dozen people are accused of allowing their identities to open bank accounts for money transfers, while others are accused of activities such as building fake websites or purchasing counterfeit diamonds. Three suspects are being tried in absentia because they are still at large.
Authorities have recovered €2.8 million, which can be used to compensate victims. According to Barron’s, the Colman law firm, which represents approximately 100 plaintiffs, said the lawsuit takes a strong stand against international financial fraud. Investors affected by the scheme are spread across multiple countries, highlighting the transnational nature of the operation and the challenges faced in combating such crimes.
