OneCoin suspend Mastercard approvals & withdrawals
Amid reports that OneCoin reopened their exchange after shutting it down for two weeks, now news that the company has suspended issued Mastercards.
Typically used to promote OneCoin on social media and YouTube, the cards had briefly allowed OneCoin affiliates to transfer commissions onto them and then spend the funds.
A message issued by OneCoin to affiliates in the last twenty-four hours reads:
Please note that due to a system upgrade, which we are processing together with the issuing bank of Mastercard OneCoin cards, both the approval of new card requests and the card loading functionality are temporarily suspended.
As soon as the upgrade is completed we will keep you duly notified.
I’m not a banker, but who ever heard of banking systems undergoing indefinite maintenance? Maintenance on banking systems is planned well in advance, with minimal downtime (minutes and in the event of a rare crash, occasionally a few hours).
Coinciding with the pulling down of OneCoin’s exchange, which saw the company freeze withdrawal requests for two weeks, it appears OneCoin’s banking musical chairs look set to continue.
OneCoin’s banking issues over the past twelve months are well documented. At one point the company claimed they were going to open up 180 banks around the world but, along with the claim they were going to register themselves with the SEC, nothing materialized.
Having observed repeated banking issues across a number of Ponzi schemes over the years, I think what’s happening here is pretty obvious.
On or around early February OneCoin’s current bank, possibly the issuer of their Mastercards, gave them notice. The deadline was likely March 1st.
OneCoin failed to secure new banking channels in time, which prompted the suspending of the OneCoin exchange (the defacto payment portal for OneCoin affiliates).
In the first two weeks OneCoin managed to secure new banking channels, but either lost or was unable to maintain a business relationship with their card issuer. Either that or there’s security issues (read: money laundering concerns) regarding integration of OneCoin’s new bank and the issuer of their cards.
All this talk about “systems maintenance” doesn’t add up. It simply doesn’t happen in the finance industry within the timeframes OneCoin are providing (indefinitely as is currently the case with issued Mastercards).
For those unfamiliar with banking issues Ponzi schemes typically go through, the clearest example I can provide is TelexFree.
A Massachusetts investigation into TelexFree revealed it played banking musical chairs in the months leading up to its collapse.
Over two years of operations, TelexFree has employed multiple financial accounts, including domestic and international bank accounts and various online payment processors, to facilitate the fraudulent offer or sale of securities in Massachusetts.
Almost all financial institutions have terminated their relationship with TelexFree after only a few months of business.
Recently, frantic emails between TelexFree management and financial institutions paint an entirely bleak picture of continuing TelexFree financial operations.
TelexFree operations have become a risk that financial institutions are no longer willing to bear.
As described by one financial institution, “no US bank or processor… will accept your [TelexFree] business given that you are on month five of the Visa Chargeback monitoring program.
You are only one of three merchants in the USA on month five so you are a real hot-potato as they say.”
Collectively, the banks that got into bed with TelexFree have had to return millions in stolen Ponzi funds they collected in fees.
But uh yeah, I’m sure the same thing isn’t now happening to OneCoin. Banking maintenance for weeks on end sounds totally plausible.