Busted! Turkish Authorities Detain 127 Suspects In Major Crypto Operation

On Thursday, Turkey’s Minister of Interior revealed authorities conducted a major operation against a crypto scamming platform in Ankara. The alleged Ponzi scheme has stolen over $1 billion in the last few years.

Crypto Ponzi Scheme Busted

Ali Yerlikaya, Turkey’s Minister of Interior, announced on X that over 100 suspects had been detained in a crypto operation conducted in Ankara. Operation “CYBERGÖZ-42” uncovered Smart Trade Coin STC’s schemes in the country.

According to the post, the fraudulent crypto trading platform promised investors “high profits with zero risk.” Smart Trade Coin’s team assured customers their investments were safe with their “Stop loss” function and “advanced trading bots” that would perform automatic buy and sell transactions for them.

However, the investigation revealed that the platform was just a traditional Ponzi scheme system that stole over $1 billion, or 32 billion Turkish Lira, from users. Existing investors were promised to “receive profit” if they brought new customers to the crypto platform. The new investors’ money would be used to keep the scheme running.

Turkish authorities conducted the operation in 21 provinces of Ankara, detaining 127 suspects of committing “international fraud by creating a Ponzi scheme” and committing “crime and laundering of assets obtained from crime.”

During the operation, authorities seized over 177 immovable assets and 61 movable assets, worth 1 billion Turkish Lira. Additionally, they confiscated an unlicensed gun, a blank firearm gun, and several crypto assets.

Smart Trade Coin’s Track Record Of Scams

Smart Trade Coin has been suspected of being a scam since 2021 as Turkish investors have protested the company and denounced their practices through the years, as informed by local media outlets.

The Kocaeli Newspaper reported about the dozens of criminal complaints filed against the crypto trading platform. In 2021, 50 people gathered in front of Ankara Courthouse to protest Smart Trade Coin and its team.

The victims’ lawyer, Yagiz Kaya, stated that over 50,000 people had been scammed in Turkey by the company. At the time, no action had been taken despite the multiple complaints filed and the estimated $2 billion loss of investors’ money.

Moreover, some testimonies from victims recount they were encouraged to take loans and sell their houses or cars to make “36 percent profit per month.” Instead of receiving large profits, most customers ended up empty-handed and in debt.

In 2023, AI Multiple Research, a data analysis and research platform, shared a study on Smart Trade Coin. According to the investigation, the platform was deemed as likely to be a crypto scam and customers were urged not to invest in the platform.

Cem Dilmegani, Head analyst at AI Multiple, pointed out the company’s unrealistic claims. The now-unavailable website claimed to “provide software that connects to multiple crypto exchanges” and “help users to use one app to manage multiple crypto exchange accounts.”

Dilmegani explained that, although not impossible, arbitrage between exchanges would be very difficult to do in practice. Additionally, he stated:

Even if this company built the technology to achieve consistent earnings via arbitrages, it wouldn’t market itself to retail investors. It would raise funds and do arbitrage at large scale.

Ultimately, the analyst highlighted the company’s opaque business practices, deceiving marketing, and lack of information as signals that the company had been a scam since the beginning.