Bulgarian law enforcement agencies have raided the offices of Onecoin in Sofia as part of a multinational effort to neutralize what authorities call a “centralized cryptocurrency pyramid scheme”. Three million people may have been defrauded by the company which offers services on four continents, according to media reports. Bulgarian officials were diligent enough to note that Onecoin has nothing in common with the decentralized Bitcoin.
50 People Questioned, No Arrests
Servers, documents and other evidence have been confiscated from Onecoin and about 50 people have been questioned by investigators, according to the official statement. No arrests have been reported so far. Bulgarian prosecutors, national security agents and members of the organized crime combating unit were involved in the joint operation. They acted on request from Germany, where Bulgarian-born “founder and visionary” of Onecoin, Ruja Ignatova, had been taken to court. “Onecoin” payments were banned in the Federal Republic and in 2016 the UK Financial Conduct Authority issued a warning about the company. The Ministry of Interior of Bulgaria released a video of the search in Onecoin’s building:
In just three years, about three million people have subscribed for the educational packages offered by Onecoin, Bulgarian prosecutors announced at a briefing on Friday. The company is suspected of commercial fraud, money laundering and illegal payments. During the press conference security officials clarified for the audience that while Bitcoin is a decentralized system, the “so called cryptocurrency Onecoin” is centralized.
“You can only buy from a company that is part of the International Marketing Association of Onecoin”, the head of Bulgaria’s Specialized Prosecution Office Ivan Geshev said, quoted by Nova. The offices of the Sofia-based subsidiary “One Network Services” EOOD and 14 other connected companies have been searched by the Bulgarian authorities.
Onecoin Busted, Onecoin Online
Onecoin operations had not ceased after its servers in Sofia were shut down, Bulgarian prosecutors admitted. The local subsidiary has been offering services on four continents, but “Onecoin Ltd.” is actually registered in the United Arab Emirates and operates through hundreds of affiliates around the world, with key markets in Europe, Asia, Latin America and Africa, according to its website. Associated companies have been investigated by authorities in Britain, Ireland, Italy, US, Canada, Ukraine, the Baltic States and other countries.
The distribution of Onecoin is forbidden in several jurisdictions, including Germany. Bulgarian authorities conducted the operation on January 17 and 18 in response to legal assistance request from the Prosecutor’s Office in the German city of Bielefeld stemming from October 2017. The 37-year-old Ignatova, former CEO of Onecoin, has German citizenship. The “virtual currency” that Onecoin offers to its customers has been used as a means of payment, circumventing local laws that cover payment services, according to the German financial regulator Bafin. Authorities have also noted the possibility of using the network to fund organized crime and terrorism.
Representatives of the Bulgarian Special Prosecutor’s Office, officers from the General Directorate Combating Organized Crime and agents of the State Agency for National Security have participated in the operation. Their actions against the international criminal organization have been observed by Europol delegates and German investigators.
One (Ponzi) Coin Exposed
Onecoin, and the network of companies behind it, has been exposed as a Ponzi scheme in multiple media reports and by many cryptocurrency experts. News outlets and journalists have been threatened by Onecoin lawyers for shedding light on the nature of its global business. Authorities, regulators and law enforcement agencies in countries like Hungary and Italy have taken measures against it and imposed fines, as http://icotrading.info has reported. In April the German federal financial supervisory authority seized funds from a company associated with the multi-level-marketing scheme to promote and sell the “cryptocurrency”.
The company has been singled out in numerous warnings issued by authorities around the world and investigated by relevant agencies. The latest attempt to end its activities is the largest in scale so far and has been coordinated with partners from other countries, as Kapital points out. The Sofia-based “One Network Services” Limited Liability Company was registered with just 2 BGN (≈1 EUR) authorized capital, according to a publication by Dnevnik. It has been previously headed by Ignatova’s mother, Veska, also investigated in Germany. Both women have vacated their Onecoin executive posts last year.
In a statement sent to the media, “One Network Services” said it had been targeted in a showcase police operation. The company has never maintained illegal activities neither in Bulgaria, nor in other countries, the press release stated. Its representatives added they were cooperating with the authorities but were kept in the dark about the subject of the investigation.
In a 2016 presentation Onecoin’s founder and visionary said: “We will rewrite history… In two years nobody will speak about bitcoin anymore.”
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