OneCoin enforce withdrawal KYC, financial troubles?
As it stands, OneCoin affiliates are waiting upwards of four weeks for withdrawals to be processed.
Support are purportedly not responsive and messages regarding withdrawals are routinely deleted from OneCoin’s Facebook page.
Now, in yet another move that distances OneCoin from legitimate cryptocurrencies, OneCoin are demanding identification documents before withdrawals are processed.
In an email sent out to OneCoin affiliates, the scheme cites “regulations regarding cryptocurrencies” as the reason behind the decision. Specifically which regulations OneCoin are referring to is not disclosed.
Due to the latest changes in regulations, OneCoin can allow only members with COMPLETE and APPROVED KYC procedure to SELL coins on the One Exchange.
To get an approval of KYC on the Exchange, please include the following information and upload photos in jpg or pdf files:
ID – could be your ID card or Passport with your picture and the names registered in your OneCoin account
Proof of Identity – you must give us a proper proof of your identity, meaning that we need to see a UTILITY BILL that has your name (the same as the one on the passport or ID card) and the address you filled in beforehand.
Note that member KYC approval may take up to 4 weeks. Any discrepances (sic) with regards to unmatched names in your OneCoin profile, your Passport/ID card or Utility Bill will mean that your KYC will not be approved.
The new KYC policies in the Exchange will be enforced from December 1st, 2015.
Anyone who is familiar with the MLM underbelly and banking regulatory problems that go with it, should be able to recognize the above for what it is.
OneCoin’s bank accounts continue to be flagged for money laundering, with the above an effort to appease financial institutions the accounts are held with.
Said financial institutions have procedures they have to follow when accounts trigger fraud and money laundering filters, with KYC implementation typically among the first steps. Transfer limits are also common, which would explain OneCoin’s ongoing withdrawal delays.
One of the big selling points of BitCoin and cryptocurrencies in general is the anonymity they provide, with KYC requirements to transfer a cryptocurrency flying in the face of that.
Moreover, OneCoin’s abrupt implementation of KYC flies in the face of recent comments made by founder Ruja Ignatova.
Speaking as a paid corporate sponsor of the EU Southeast Europe Summit, held over October 14th and 15th in Bulgaria, Ignatova proclaimed:
Emerging markets are out there. We can speak about Latin America, we can speak about Asia, we can speak about Africa … and we can speak about also the small Asian countries.
In all these countries we have an issue, that we also have here actually, alot of people are underbanked, unbanked or just forgotten by the big players.
Because they are poor, because they needs that are not that interesting in the transactions. Or simply because some of these people do not have proper documents.
I have been in countries where every one of them has a smart phone, but nobody has a proper ID card.
So how do these people bank?
Ignatova goes on to present OneCoin as a solution to this problem.
Yet as per their latest withdrawal stalling policy, unless OneCoin affiliates have an ‘ID card or Passport with your picture and the names registered in your OneCoin account‘ and “proper proof of your identity”, they are now effectively cut off from invested funds.
BitCoin and other legitimate cryptocurrencies meanwhile have no such restrictions on transfers between users.
As far as Ponzi schemes go, KYC is typically implemented as regulators close in. TelexFree implemented it in their final months and if I recall correctly, Zeek Rewards had some form of it too.
Basically as a Ponzi scheme hits critical mass, the sheer amount of transfers sets of financial regulatory alarms around the world. Schemes then scramble to justify the huge amount of transfers by providing banks with affiliate KYC documents.
Without which requested withdrawals are denied indefinitely.
This isn’t the banks trying to take anyone’s money mind, it’s them protecting themselves in the event regulators move in and start seizing funds and freezing accounts.
As part of the ongoing TelexFree Ponzi litigation, banks all over the world have been sued. All but one or two have settled, covering the return of stolen Ponzi funds out of their own pocket (the customers responsible have long-since withdrawn the funds).
If a bank is able to show they implemented strict KYC procedures upon detecting potential money laundering and Ponzi fraud, they’ve naturally got more of a leg to stand on legally.
As far as OneCoin are concerned though, having touted themselves as a cryptocurrency for people without ID documents for just over a year now, they’re now likely to be flooded with chargebacks and angry affiliates demanding their money back.
That will in turn set off an even wider array of financial fraud filters, placing additional strain on existing banking relationships.
It’s pretty much why we’ve been seeing OneCoin play bank account pingpong these last few months, with the situation only likely to deteriorate as we enter the preliminary stages of a collapse.
On the plus side, at least for those who do manage to send off the required KYC, when the time comes to clean up this mess regulators will have some paperwork to get started on.
One of the biggest challenges in huge Ponzi regulatory cases is the piecing together of victim details. KYC tied to specific investor accounts should make that process somewhat easier.
At least on the verification side of things. For those who jumped on OneCoin because they believed it to be a legitimate cryptocurrency they wouldn’t need ID to use, maybe you can ask Juha Parhiala for a loan.
It is after all one million dollars of your money he’s withdrawing each month…
Update 23rd January 2024 – Ted Nuyten quietly deleted all OneCoin coverage on BusinessForHome in January 2024.
This article originally contained links to cited BusinessForHome articles. Due to the deletion of the content, those links have now been disabled.
Nuyten hasn’t publicly addressed why OneCoin coverage on BusinessForHome was deleted.