A foreign man, described by Jornal de Notícias as an Italian citizen, has been arrested by PJ police in the Algarve for allegedly running a Ponzi scheme – an investment fraud that pays existing investors with funds collected from new investors – amounting to more than €3 million.
The 48-year-old man, who posed as the supervisor of a Spanish insurance brokerage company and has a record of similar crimes, is believed to have swindled investors out of at least €3 million, PJ police have revealed, following an inquiry by the Department of Investigation and Criminal Action (DIAP) of Évora.
The ‘pyramid scheme’ worked by luring investors with promises that they would receive “considerable interest when investing in funds and insurance”.
JN reports that the scheme ‘worked as planned’ initially, as new investors allowed the man to reimburse his initial investors.
Suspicion arose when the suspect began having trouble attracting new investors, which prevented him from repaying his previous investors.
Many of the victims alerted authorities when the man became unable to pay them. Operation “Dolce Vita” by the PJ police resulted in the arrest of the scheme’s leader, and the seizure of “six vehicles, documents and various objects”.
Authorities also discovered that the man launched a company for the scheme, which boasted “offices, employees and vehicles”.
Said PJ police, the goal was to “simulate real commercial activity and guarantee the permanent entry of funds”.
The police force added that the scheme, which is believed to have started in 2018, was entering its “final stage” and that the man was preparing to leave the country when he was arrested.
He is suspected of crimes involving fraud, document falsification, money laundering and illegal insurance operations.
The suspect will await trial in police custody. JN reports that Évora’s criminal court ordered detention on remand due to his criminal background.
Says JN, the man had already been arrested for posing as a “fake doctor” in Spain. A court in Tenerife ruled that the man worked as a doctor at a plastic surgery clinic in the Canary Islands between 2010 and 2012, despite his only credential being a diploma from the Trinity Institute of Christian Counseling, which he claimed was based in the UK but was actually a USA-based theology centre.