More than 360,000 Germans were conned into buying online lottery cards for a draw that does not exist.
The racket was being operated out of Greece.
Some €36 million has been pocketed from selling worthless lottery cards.
Police in Athens arrested two men, aged 44 and 36 and both born in Germany, on suspicion of organising the scam.
It is believed the pair is part of a gang which is suspected of illegally obtaining the names of people who use betting companies.
Over the telephone, these people were offered cash prizes or free holidays in return for a subscription of €29.90 every month.
Bogus companies then funnelled the profits into various bank accounts.
"Members of this racket had tricked around 360,000 people in Germany into participating in non-existent lottery draws for a monthly fee of 29.90 euros," the police said in a statement.
"Their profit exceeded €36.5 million.”
The police also said that the fraud had been going on for at least three years.
