During an investigation into money laundering using cryptocurrency exchanges, Brazil's civil police seized R$172 million ($33 million in US dollars).

Brazilian police executed six search warrants during the "Exchange" operation in Sao Paulo and Diadema, after which the Brazilian judiciary authorised freezing accounts and seizing assets from two individuals and 17 companies, according to an official statement that did not name them.

Crypto exchanges bought and sold bitcoin to fictional firms created to provide their creators access to the banking system, according to the investigation.

One of the exchanges transacted $1.93 million in digital assets with six phoney firms over a five-month period, while eight other bogus organisations bought $2.9 million in cryptocurrency, the police said. 

The exchanges did not check the legitimacy of the entities they dealt with or the origins of the transactions, the Brazilian police said, adding that the exchanges knowingly acted on behalf of a criminal organisation dedicated to money laundering through cryptocurrency.

Money was routed to offshore firms and then repatriated by faking sales or service provision transactions, according to the probe.

Preliminary investigations indicated that the companies engaged in large transactions among themselves and t he money was subsequently transferred to intermediaries, who were in responsible of acquiring digital assets and the delivery of a hash code to their clients.