Recyclix suspension ordered by Italian securities regulator
Recyclix is an MLM opportunity that launched in late 2015.
Under the guise of generating revenue via recycling plastic, Recyclix solicits deposits of up to €100 EUR on the promise of a >100% ROI.
In reality the only source of revenue entering Recyclix is affiliate investment, making Recyclix a Ponzi scheme.
Earlier this year Russia and the Ukraine were primary sources of traffic to the Recyclix website. Italy has since emerged as a prime source of investment for the scheme, with the country currently making up an estimated 9.1% of traffic.
Italy is second only to Germany, who provide 9.6% of all Recyclix website traffic.
This has caught the attention of Italian regulator Commissione Nazionale per le Società e la Borsa (CONSOB), who on the 14th of September published the findings of an investigation.
CONSOB, otherwise known as the Italian Securities and Exchange Commission, is ‘is the government authority of Italy responsible for regulating the Italian securities market.‘
CONSOB’s published warning observes that Recyclix affiliates invest funds, click a button marked “recycle” and earn an 8% to 14% monthly ROI.
Investment of additional funds can boost the monthly ROI payment up to 50%.
An investigation carried out by CONSOB lead them to contact the law firm Amodio, who Recyclix claim they are represented by.
Amodio clarified that
The activity carried out by that company through the recyclix site is not related to the activity of raising capital from a public pool of investors.
Considering all the Recyclix website does is solicit investment from affiliates, who are very much members of the public, Amodio’s response is laughable.
Other peculiarities with Recyclix’s asserted business model CONSOB observed include:
- Recyclix affiliates know exactly the return generated by (the) purchase of waste, as represented by Recyclix, as a percentage value, which is not subject to fluctuations and / or variables and
- the claim Recyclix affiliates can “buy equipment used in the recycling process”, as mentioned on the Recyclix website, is misleading
CONSOB also requested information from Recyclix regarding Italian investors but this information was not provided.
Citing Legislative Decree no. n. 58/1998, pertaining to the offer of financial products in Italy, CONSOB concluded that Recyclix’s MLM opportunity ‘has the characteristics of a public offer of financial products‘.
Recyclix have not registered with CONSOB and thus are ‘in violation of legal and regulatory provisions‘.
CONSOB will now pursue a suspension of Recyclix’s activities in Italy for 90 days.
This resolution will be brought to the attention of the parties concerned and published in the Bulletin of Consob.
At the time of publication Recyclix have yet to respond to CONSOB’s allegations.