FinCEN Leaks: Bank Of New York Mellon Flagged Funds Linked To OneCoin Crypto Scam

The latest leaks from the Financial Crimes Enforcement Network or FinCEN has revealed how Bank of New York Mellon (BNY Mellon) processed funds for companies and people associated with the OneCoin cryptocurrency scam.

According to the report that news outlet Buzzfeed shared with the International Consortium of Investigative Journalists (ICJ), FinCEN has been alerted by the Bank of New York Mellon (BNY Mellon) through a “Suspicious Activity Report” or SAR about transactions that it thinks are being done to obfuscate the origin of the funds being transacted. In money laundering, this is called “layering”.

BNY Mellon said the transaction, worth a total of $137 million, were connected to entities related to OneCoin, a cryptocurrency scheme flagged by U.S. authorities as a Ponzi scam. OneCoin has raised north of $4 billion in proceeds, making it one of the most successful cryptocurrency-related scams.

One of the cases mentioned in the leaks is that of an Australian woman who sent more than $50,000 from her own organic skin care company to recipients that included two OneCoin companies. SARs, by their nature, are just concerns of compliance officers and are not indicative of criminal conduct.

Another transaction in 2016 worth $30 million from Fenero Equity from the British Virgin Islands, wired across three continents, three countries and 3 banks, to Barta Holdings as the eventual beneficiary.

The money trail begins in the British Virgin Islands, where Fenero sent $30 million from its account at a Cayman Bank named DMS bank, and then transferred to BNY Mellon in the United States. The details of payment said it is a “loan for CryptoReal”.

BNY Mellon flagged the transaction in an SAR, where it wrote that Fenero has received wires from shelled entities associated with OneCoin.

CryptoReal was OneCoin’s “investment trust,” the FinCEN leaks noted.

BNY Mellon proceeded to transfer the funds to DBS Bank in Hong Kong, where the money was credited to Barta Holding’s account which, according to BNY Mellon’s own research, was owned by a Chinese businessman.

In a separate report by Coindesk, Mark Scott, who was convicted in 2019 in relation to the OneCoin scam, arranged the loan from Fenero to Barta to purchase an oil field from the latter. Emails seized in relation to the case, however, said the loan was not repaid. Additionally, $10 million from that loan was just spent by OneCoin co-founders.

Although banks do not comment on suspicious activity reports they filed, a spokesperson from BNY Mellon told the ICJ that it takes its role in protecting the integrity of the global financial system seriously.

Meanwhile, Ruja Ignatova, the founder of OneCoin whose whereabouts is currently unknown, did not respond when the ICJ requested for her comments.