Crypto platform OneCoin has been sued for operating a Pyramid scheme that witnessed its investors lose billions in cryptocurrency revenue. New details and evidence about the case suggest that the heads of the Ponzi scheme were willing to dupe anyone.
The scheme victimized two churches: the Samoan Independent Seventh Day Adventist Church’s (SISDAC) Auckland branch and the Samoa Worship Center Christian Church. They are “holding out hope” that they could recover their funds after the OneCoin scheme has been promoted by congregation leaders from the organizations.
Several regulars and followers at the churches have been persuaded to put their money into the “get rich quick” scheme. “In these communities, there is an enhanced sense of family and community bonds, and with that comes a very strong sense of trust. Of course, trust can be exploited by these scams,” Auckland-based attorney Campbell Pentney explained.
According to Ed Moy, who directed the US Mint from 2006 to 2011, “if it seems too good to be true, it’s too good to be true. Cryptocurrency, in many ways, is just a much more efficient mechanism [for making transactions], but a scam is still a scam… The pitch of the scam was, ‘We developed this coin; it’s going to be worth a ton of money. Please invest.’ Cryptocurrencies themselves, in general, are not a bad thing, but if you’re creating it out of thin air and there’s nothing to it and it’s the front for a scam, it just makes it a much more efficient scam, and because the volume of dollars is so much greater for electronic and digital transactions, crooks go where the money is.”
Sebastian Greenwood and Ruja Ignatova, who are now convicted criminals, created OneCoin in 2014. Within merely two years, the currency gained almost $4 billion, marking one of the highest gains for a digital currency.
Per the prosecutors, the coin was intended to be a scam currency. OneCoin leaders purportedly encouraged investments without providing a “way to transfer, sell or exchange funds,” or a “public blockchain by which it could be monitored.”
“These defendants created a multibillion-dollar cryptocurrency company based completely on lies and deceit. They promised big returns and minimal risk, but, as alleged, this business was a pyramid scheme based on smoke and mirrors more than zeroes and ones,” Manhattan US lawyer Geoffrey Berman detailed.