OneCoin an “illegal MLM” in Colombia
The Superintendency of Societies is a government regulator in Colombia charged with overseeing companies operating in the country.
Citing a new law introduced earlier this year in January, the Superintendency of Societies has issued a warning against OneCoin.
Differentiating OneCoin from legitimate MLM companies, the Superintendency of Societies claims OneCoin is ‘not contained within (the group of) companies (that are) legally constituted as multilevel (marketing companies) in Colombia‘.
According to Francisco Reyes Villamizar, Colombia’s Superintendent of Companies, a law passed on January 24th, 2016 requires legitimate MLM companies operating in Colombia ‘must establish a branch in the country‘.
OneCoin has no physical presence in Colombia which, according to Villamizar, means it ‘cannot act as a network marketing company, or be a commercial representative for this class of foreign companies (MLM)‘. They are also prohibited from claiming OneCoin affiliates who reside in Colombia constitutes the operation of a branch there.
Addressing OneCoin’s business model, the Superintendent of Societies warns:
For a company to offer multilevel compensation or commissions that pay independent affiliates, commissions must correspond proportionately to (retail) sales (of products) and not be generated by the mere act of recruiting new people into the company.
BehindMLM first reviewed OneCoin back in late 2014. Citing a lack of retail activity in OneCoin’s business model, we concluded it was a Ponzi scheme.
A secondary concern raised about OneCoin is its use as a currency within Colombia.
According to the Superintendency of Societies, who cite a Bank of the Republic resolution;
The only monetary system permissible in Colombia is the peso (notes and coins), so other mechanisms, as in this case “Onecoin”, are not a means payment of legal tender with unlimited liberatory power.
Consequently, the “Onecoin” is not an asset that has legal equivalence to the legal currency in Colombia not having been recognized as currency within the country.
Neither is OneCoin an asset that can be considered a currency, according to the criteria of the International Monetary Fund, since it neither has the support of the central banks of other countries and therefore has no financial power.
I’ve described the currency warning as a secondary concern, because as per OneCoin’s Ponzi points business model, affiliates are unable to use OneCoin as a currency.
Since conception, all you can do with OneCoin is invest in them and cash out a tiny percentage each week permissible by the company.
And even then OneCoin has a history of declining permissible withdrawal requests, as evidenced by the litany of complaints their affiliates routinely publish on Facebook. Most of which are quickly deleted by OneCoin staff.
OneCoin and their investors had previously boasted they had 500,000 merchants willing to accept OneCoin as payment, once 30% of OneCoin’s had been generated by their script.
30% of OneCoin’s were generated earlier this week, yet no announcement regarding the 500,000 merchants has been made. OneCoin themselves have yet to even acknowledge the 30% milestone.