French police have seized €200,000 worth of Bitcoins as they shut down an illegal exchange, in the first such operation in Europe.
Two people in the Riviera coastal cities of Cannes and Nice were placed under formal investigation on Friday and detained on suspicion that they operated a website which illegally sold and lent Bitcoins to its users.
During a raid last week on one of the suspects' homes, investigators seized a portfolio of 388 Bitcoins – worth some €9,000 each – as well as credit cards and computer hardware, a public prosecutor said today.
"It's the first time in Europe that a judicial action has resulted in the closure of an illegal exchange for virtual currency," Olivier Caracotch, prosecutor in the south-western town of Foix where the investigation started, told Reuters.
"It's also the first time in France that Bitcoins have been seized as part of a judicial procedure."
Police were tipped off to the platform's existence by a retired policeman who alerted financial investigators after buying Bitcoins on the site, he said. The two suspects were being investigated on possible charges of illegal banking, money laundering and illegally operating a gambling website.