Welcome to Latam Insights, where we recap the most significant crypto and economic news from Latin America over the past week. In this issue, we cover a massive crypto money laundering crackdown in Brazil, the use of AI to detect crypto-linked tax fraud, and the halt of Nucoin trading by neobank giant Nubank.
Operation Niflheim: Brazilian Police Take Down $9.7 Billion Crypto Laundering Networks
Brazilian authorities launched Operation Niflheim, targeting three major money laundering organizations that used cryptocurrency to launder approximately $9.7 billion. The Brazilian Federal Police, in collaboration with the Federal Revenue Service, carried out a series of raids, issuing eight arrest warrants and executing 19 search and seizure orders across Caxias do Sul, São Paulo, Fortaleza, and Brasília.
In addition to the arrests, the Federal Court froze $1.58 billion in funds across bank accounts and cryptocurrency exchanges. Authorities also seized several properties and vehicles as part of the operation. According to local reports, the laundered funds originated from illegal activities such as drug trafficking and smuggling. The investigation, which began in 2021, highlights the increasing use of crypto in organized crime.
Brazilian Tax Authorities Use AI to Uncover $180 Million in Crypto Tax Fraud
In a bid to combat tax evasion involving cryptocurrencies, Brazil’s Federal Revenue Service has introduced a cutting-edge artificial intelligence (AI) tool designed to detect fraudulent transactions. The AI tool, developed in-house, uses complex algorithms and network analysis to scrutinize tax data, improving the efficiency of investigations into illicit crypto activities.
The agency recently reported two successful instances where this AI tool uncovered over $180 million in crypto-related tax fraud. The system has enhanced the tax authority’s ability to identify illegal transactions and has proven effective in boosting the productivity of investigations. This development underscores the growing role of AI in financial oversight and regulation.
