A joint investigation conducted by several European law enforcement authorities, supported by Europol and Eurojust, has culminated in the arrest of 9 suspects following the notorious “JuicyFields” investment fraud case. On an action day carried out on 11 April 2024, over 400 law enforcement officers in 11 countries executed 9 arrest warrants and conducted 38 house searches. During the investigation and action day, EUR 4 700 000 (about $5 million) in bank accounts, EUR 1 515 000 (about $1.6 million) in cryptocurrencies, EUR 106 000 (about $113,000) in cash and EUR 2 600 000 (about $2.8 million) in real estate assets were seized or frozen. Law enforcement also seized several luxury vehicles, works of art, cash and various luxury items, as well as large numbers of electronic devices and documents.
According to judicial estimates, the total damages resulting from fake investments in the advertised cannabis cultivation crowdsourcing platform amount to a staggering EUR 645 million (about $687 million), but actual and unreported damages could be significantly higher. In total, an estimated 550,000 participants worldwide, most of them European citizens, were registered as online investors. Using bank transfers or cryptocurrencies, around 186,000 participants actually transferred funds into the elaborate Ponzi scheme active from early 2020 to July 2022.
JuicyFields and its fake cannabis investment opportunities
The suspects, of mainly Russian but also Dutch, German, Italian, Latvian, Maltese, Polish, Jordanian, United States and Venezuelan nationality, used advertisements on social networks to lure victims to their websites. These platforms offered promising crowdsourcing investment opportunities in the cultivation, harvesting and distribution of cannabis plants to be used for medicinal purposes.
With a minimum initial investment of at least EUR 50 (about $53) in this so-called ‘e-growing’ opportunity, investors were promised to be linked with producers of medical cannabis. Upon the purchase of a cannabis plant, the platform assured investors – also referred to as e-growers – they could soon collect high profits from the sale of marijuana to authorised buyers. While the company pledged annual returns of 100 percent or more, they did not reveal exactly how they would accomplish this, let alone be able to guarantee it.
The legalisation of cannabis cultivation or the expansion of permissible THC content in cannabis products for personal, recreational, and therapeutic purposes is a significant subject of public debate within the EU. This discourse is further fuelled by the reality that cannabis stands as one of the most widely consumed illicit substances both within the European Union and globally. As seen in other contexts, criminal networks are particularly adept at applying new narratives to existing criminal practices, particularly in periods of changes in regulatory frameworks, which may open up a window of opportunity for fraudsters to advertise low-risk, high-profit investment opportunities.
A classic 'too good to be true' Ponzi scheme
A Ponzi scheme is a type of investment scam where criminals promise high returns with little or no risk to investors. Instead of actually generating profits through legitimate business activities, the scammers use money from new investors to pay returns to earlier investors. This creates the illusion of a profitable enterprise, but in reality, the scheme collapses when there aren't enough new investors to sustain the pay-outs, leaving most investors with losses.
As an example, the average - even cautious - investor would make an initial investment of EUR 50 (about $53) and receive a pay-out doubling their money soon after. Motivated by these financial gains, many investors would raise the stakes and pay in hundreds, thousands, or in many cases even tens of thousands of euros. The platform feigned credibility as it was not only represented in the digital world, but upheld the image of a trustworthy legal business structure with physical offices, staff and representation at cannabis industry events. Initially, the more than 500 000 e-growers were receiving their investment returns. In July 2022 however, the criminals behind the scheme abruptly removed company profiles from social media networks and stopped users from logging in to their accounts, thus freezing cash withdrawals.
Complex investigation following elaborate fraud scheme
The widespread occurrence of police reports across Europe prompted Europol to initiate a coordinated approach for investigations involving multiple EU and non-EU countries. This law enforcement focus on JuicyFields and related investment platforms was followed by the establishment of a joint investigation team at Eurojust, led by German and Spanish Police, French Gendarmerie and supported by Europol, the National Crime Agency of the United Kingdom and other law enforcement from numerous Member States. After painstakingly piecing together breadcrumbs of digital evidence, investigators had drawn up a joint intelligence picture that allowed police forces across Europe to initiate this wave of arrests.
One of the primary High Value Targets in this investigation was traced to a residence in the Dominican Republic. The Russian national, suspected to be one of the main organizers of the fraudulent scheme, had a property he was residing at searched by the Dominican Republic authorities with officers from the Spanish investigation team along with a Europol specialist deployed on site to assist with coordination.
Europol’s role
Europol supported this massive cross-border investigation from the very start, taking the lead in operational coordination and providing tailored analytical support. Furthermore, Europol shared results of financial investigations as well as other intelligence with the involved countries. On the action day, Europol deployed officers with mobile offices to various locations around the globe. Eurojust ran a coordination centre, staffed by senior police officers from the various investigation authorities, prosecutors and Europol staff, to assist with the coordination of legal coercive measures in multiple countries in multiple time zones.
