Spain’s Civil Guard has dismantled what authorities describe as one of the country’s largest crypto-related scams; the Madeira Invest Club fraud. The alleged scheme, led by Spanish national Álvaro R., known online as “CryptoSpain”, reportedly lured more than 3,000 victims with promises of guaranteed returns from investments in digital assets, luxury properties, and other high-value goods. Investigators now say the operation had no real investment activity and instead functioned as a pyramid scheme that cycled funds from new investors to pay earlier ones.

How the Madeira Invest Club Operated

According to Spain’s Ministry of the Interior and details reported by CoinDesk and NarcoDiario, the Madeira Invest Club began operating in early 2023, presenting itself as a private investment group with access to exclusive opportunities in cryptocurrency, real estate, tokenized art, and gold. Members were invited through online channels and private groups, with marketing focused on “secure returns” and “buyback guarantees”.

Authorities say these claims were completely fabricated. While investors were told their contributions were used to acquire tokenized or luxury assets, investigators found no evidence of legitimate economic activity. Instead, the operation followed a classic Ponzi structure, new deposits were used to make partial payouts to existing investors, creating an illusion of profitability and stability.

The Civil Guard, under the direction of Spain’s National Court, arrested the suspect after a year-long investigation codenamed Operation PONEI. The probe revealed a web of shell companies and bank accounts spanning more than ten countries, including Portugal, the United Kingdom, the United States, Malaysia, Belgium, Thailand, and Hong Kong. Authorities believe this network helped conceal money movements and delay detection.

Related read: South Korean Police Bust Fake Exchange Ring

Cross-Border Investigation and Legal Action

The international nature of the Madeira Invest Club fraud prompted coordination between Spain’s Civil Guard, Europol, and law enforcement partners in several jurisdictions. Reports indicate that millions of euros were moved through foreign accounts and converted into both fiat and crypto assets to obscure the trail.

Spain’s National Court has ordered the suspect to remain in custody without bail, citing a significant flight risk and concerns about asset concealment. Investigators are now focused on tracing the flow of funds, freezing accounts, and identifying potential accomplices involved in managing the network’s offshore entities.

Local media note that the operation’s apparent sophistication; mixing digital assets, art, and real estate, made it appear legitimate to many victims. This blending of traditional and crypto-linked investments, combined with influencer-driven marketing, helped the scheme spread quickly before collapsing under its own weight.

Also read: Crypto Scams You Must Know in 2025

A Cautionary Moment for Crypto Investors

The exposure of the Madeira Invest Club fraud serves as another reminder of how easily high-return investment promises can disguise large-scale deception. Spain’s Civil Guard has emphasized the importance of verifying financial credentials, avoiding guaranteed-return schemes, and recognizing that legitimate crypto investments always carry risk.

While the investigation continues, this case underscores growing regulatory attention toward influencer-led crypto ventures in Europe. Authorities are now evaluating whether stricter oversight of online investment promotions is needed to prevent similar schemes.

For now, the fall of “CryptoSpain” and the unraveling of Madeira Invest Club highlight a familiar truth, in both traditional and digital finance, transparency and proof of real activity remain the strongest safeguards for investors.