OneCoin banned in Italy, deemed a pyramid scheme
Amid concerns OneCoin was a “deceitful Ponzi scheme”, last December the Italian Antitrust and Consumer Protection Authority (AGCM) ordered affiliates in Italy to stop promoting the company.
A preliminary injunction concluded a few weeks later, resulting in an interim injunction banning promotion of OneCoin in Italy.
Citing legal opinions the company had paid for, OneCoin dismissed the AGCM’s preliminary findings.
On February 27th the AGCM announced they’d concluded their investigation into OneCoin.
As per the AGCM’s press-release, the AGCM have banned promotion of OneCoin in Italy. This is a step up from the injunction previously issued, and will take effect until further notice.
The AGCM also announced it has “initiated proceedings” against One Network Services (OneCoin’s parent company) and three Italian affiliates.
The nature of the proceedings were not disclosed.
Citing the findings of their investigation, the AGCM claim
the bulk of the revenues (in OneCoin are) obtained via activities promoted by affiliates.
This is not so much from the purchase of the OneCoin virtual currency but rather from the payment of fees that consumers are requested to pay when they join the system.
To reach the goal of generating a profit, OneCoin affiliates appear to be required to recruit other consumers.
These arrangements are attributable to the typical dynamics of pyramid schemes.
This conclusion was based off a joint investigation into OneCoin between the AGCM and a Special Unit of the Financial Antitrust Police.
BehindMLM first warned consumers about OneCoin back in September of 2014. Analysis of the company’s business model revealed Onecoin was a mix of Ponzi and pyramid fraud.
Update 8th March 2018 – Following an appeal, an Italian Administrative court has reversed AGCM’s suspension of OneCoin.
The new directive has been issued while AGCM continues to investigate.