As Portfolio.hu reports, the Hungarian National Bank warned people last December, that pyramid schemes, like Bitcoin, were spreading in Hungary. OneCoin is a similar pyramid scheme, which seemingly enables to invest in crypto currencies, however, trading was only allowed on the closed “stock-market” operated exclusively by the issuer. Promising high yields, new entrants are recruited online in a way that those who had joined before are paid higher bonus from the money new entrants pay.
The supervisory department of the Hungarian National Bank told Portfolio.hu that the bank denounced a company at the Hungarian police on 23. April 2010, because it was selling OneCoin. Also, since 2014, there have been several investigations on fraud, embezzlement and the suspicion on organizing pyramid schemes. Since 2014, altogether 10 consumer requests were made to the customer service of the Hungarian National Bank in connection with virtual money. People were asking information on Bitcoin, OneCoin or crypto currencies, in general.
OneCoin is suspicious not only for the Hungarian National Bank but also for foreign supervisories. For example, Italy’s financial supervisory has temporarily banned the selling of OneCoin in the end of December. Investigations revealed that the company behind this activity offers a significantly high yield for buying education packages for 140 Euros, Portfolio.hu reports. The Financial Conduct Activity in London also warned people in the end of last September, and they mentioned that London Police was also conducting investigation on the company. The Belgian financial supervisory warned people, too, last August, that OneCoin was being sold in Belgium without the permission of the authorities and the local issuing bank.
It is obvious, Portfolio.hu writes, that a huge and wide international network has been built and has been growing for years. They have at least 3 million members. One of Portfolio.hu’s readers told the magazine that there is an “offline” agent in Hungary who is actively developing OneCoin’s network. He told Portfolio.hu how the recruiting works.
They do not sell investments but education packages. This is important so that they are not treated as an investment service company, still, they promise high yield and profit. The more expensive package you buy, the more you certainly win on the investment. For instance, the salesperson offers you at least three packages, because the one who recruits the new client earns three times more money. Then, the new client receives some OneCoints on his/her account. Theoretically, 60% of this amount could be transferred immediately, but is not worth it. Instead, you have to use your gift coupon code received from the salesperson, because the costs of transferring money can be evaded. There is a webstore called Dealshaker.com where every article is cheaper if you pay with OneCoin. These articles have to be sold for a low price. This way, you can earn a lot of money from the system, Profit.hu informs.
One person cannot miss from the story of OneCoin: this is Dr. Ruja Ignatova, a Bulgarian lady, the inventor of OneCoin, the CEO and founder of the company.
Portfolio.hu notes that pyramid schemes seem to have a tradition in Hungary. It looks like people will never learn that there is no 5% monthly, 1% weekly or 30% annual granted yield, not, at least, without any risk.
[box] OneCoin even has a very persuative introductory video: [/box]
Source: Portfolio.hu, Youtube.com