Spanish Authorities Dismantle AI-Powered Crypto Scam Ring That Defrauded Victims of €19M

Spanish authorities have dismantled a sophisticated crypto investment scam that defrauded over 200 victims out of more than €19 million

Spanish authorities have dismantled a sophisticated crypto investment scam that defrauded over 200 victims out of more than €19 million ($21.5 million) and involved using artificial intelligence to create fake celebrity endorsements, the Spanish National Police said in a statement on Thursday, August 24.

The investigation, which spanned two years, led to the arrest of six individuals across Spain.

The case unfolded when a man from Granada reported losing €624,000 ($700,000) in a suspected crypto investment fraud. As police delved deeper, they discovered a broader scheme.

The scam involved connivers who used AI-generated videos of well-known public figures to convince victims to invest in what appeared to be a high-return crypto venture. However, to unlock their original investments, victims were told they needed to make additional payments, thereby perpetuating the fraud.

Police did not specify which cryptocurrencies were targeted but urged citizens to be wary of high-return digital asset schemes.

The alleged leader of the criminal operation was arrested while trying to flee to Dubai.

The suspects, aged 34 to 57, are now facing charges of fraud, money laundering, and falsifying documents.

Police did not confirm whether any of the stolen funds were recovered. The investigation remains ongoing.

The case highlights a growing trend in crypto-related scams, where AI-generated deepfake videos and hijacked celebrity identities are increasingly used to promote fraudulent investments.

Similar scams have been on the rise, with criminals exploiting public trust in recognizable figures to push meme coins or pump-and-dump schemes.

Just this week, Guns N' Roses guitarist Slash announced his departure from social media platform X after his account was compromised and used to promote a fake crypto scheme.

Slash left X, formerly Twitter, after his account was hacked and used to promote a scam. The incident prompted Slash to advise his fans to "beware of any other social media accounts in my name."

Last month, the widely followed crypto news outlet Watcher.Guru confirmed that its official X account was hacked after a fake post about a potential deal between Ripple and SWIFT spread across its social media channels, potentially affecting interest in XRP.

The incident came amid a broader trend of crypto-focused social media hacks, many of which are used to pump newly launched meme coins.

In February, Dior’s Instagram account was hijacked to promote a fake Solana-based token, which briefly reached a $280,000 market cap before plummeting 90%.

Last week, Kaito AI, an artificial intelligence-driven platform providing crypto market analysis, and its founder, Yu Hu, were also targeted in a social media hack on X.

Hackers took control of the account and falsely claimed that Kaito AI’s wallets had been compromised, warning users that their funds were at risk.

In February 2025, losses in the crypto ecosystem increased by 20x month-over-month compared with January 2025, according to the latest report by major blockchain security platform Immunefi.

In January, registered losses stood at $73,915,700. Just a month later, this figure jumped to $1,528,342,400. The latter was the result of nine hacks.

The February number is also an 18x increase from the same time a year prior. In February 2024, registered losses were $81,603,400.