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Several days after the German Federal Financial Supervisory Authority (BaFin) has issued a cease and desist order against the OneCoin MLM scam, sate criminal police prosecutors from the North Rhine-Westphalia and local investigators of the city of Bielefeld, have opened an investigation.
According to the German newspaper Süddeutsche Zeitung, the investigation is against seven employees of the Bielefeld-based company IMS International Marketing Services GmbH, which was processing the payments of the German “investors” in OneCoin. The probe is for fraud and violation of the German payment systems regulation.
Back in April BaFin issued a cease and desist order against IMS and blocked its accounts holding €29 million of the estimated €360 million collected by it on behalf of OneCoin.
Representatives of the sate investigators told the newspaper, that the probe could be expanded to include other OneCoin companies.
Meanwhile, the Hungarian c-bank Magyar Nemzeti Bank (MNB), has set up a task force to take “joint actions against certain elements of the alleged pyramid scheme OneCoin virtual currency”. The task force includes members of the Budapest police, the city prosecutor’s office, the prosecutor general’s office, the National Tax and Customs Administration, the National Bureau of Investigation, the National Police and the MNB.
According to MNB, OneCoin resembles a pyramid scheme (Ponzi Scheme) that makes profit promises that cannot be verified.
At the same time, Indian media report that the police has arrested 18 people promoting OneCoin in the country and have seized funds from bank accounts deposited by would-be investors, amounting to $2 million.
OneCoin is a special type of cryptocurrency that could bring big profits to those who sign up for the training “seminars” of the company. The company claims it has mined 749,970,000 OneCoins and has “ global customer base of millions of people in over 195 countries and six continents and is independent of governments”. The scheme is ran by the Bulgarian Dr. Ruzha Ignatova and has the penchant of throwing lavish parties across the world to promote itself and attract gullible investors.
The scheme repeatedly turns up in the sights of various financial regulators, most recently of Malta Financial Services Authority (MFSA). There have been warnings against it from Belgium, UK, Latvia, Bulgaria, Hungary, investigations in Sweden and publications in various European media telling of the scam and likening the OneCoin to “Monopoly money”.