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Office of Competition and Consumer Protection

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UOKiK warns against Das Coin and Netleaders

< previous | next > 15.04.2019

UOKiK warns against Das Coin and Netleaders
  • CL Singapore, a company that launches the DasCoin cryptocurrency and encourages the purchase of licenses, sells empty promises.
  • UOKiK suspects that this may be a pyramid scheme because the company owner promises profits primarily in exchange for persuading other people to join it.

The Office of Competition and Consumer Protection issued a consumer warning against CL Singapore based in Singapore, which launches the DasCoin cryptocurrency. The enterprise is also building up its sales network, which is called NetLeaders. The company offers licenses that cost from 100 to 25,000 EUR, depending on their type. A licensee, in exchange for payment, receives the so-called cycles of certain value for which he/she can buy CL services or the DasCoin currency. In fact, however, CL Singapore only offers promises, because most of products available under the license do not exist.

In practice, the system promoted by CL Singapore may be a pyramid scheme because the company encourages its potential clients to buy license packages and promises profits primarily in exchange for persuading others to deposit their money. Thus, they fund the scheme for empty promises. The main business purpose of CL Singapore is a rapid increase in the number of new members. It means an inflow of cash to the scheme authors and the main “touts”. Sooner or later such a big increase in users will end and the system will stop working. Consumers will be left with an empty account and unfulfilled promises, says Marek Niechciał, the President of UOKiK. The District Prosecutor’s Office in Warsaw is also interested in the case and is investigating under the reference number PO 5 Ds. 33.2017.

Cryptocurrencies are very popular. This popularity is used by companies to attempt fraud, such as pyramid schemes. The authors of such frauds give credence to them so that they look like a legitimate, serious business. For example, they cooperate with celebrities, organize and advertise lavish press conferences in attractive places abroad, sponsor various events. This makes them attract many people who want to make a lot of money and quickly. And this is not possible, adds the President of UOKiK.

This is another warning given by UOKiK. The Office has already warned consumers against ventures that can be a pyramid scheme, such as BCU Trading in Dubai (FutureNet and FutureAdPro), One Life Network in Belize.

Consumers should be alerted when someone:

  • guarantees them very high profits in a short time,
  • generally, or inexplicably describes his/her operations, or says he/she has just started his/her business activity,
  • avoids answering specific questions,
  • uses lofty phrases such as “become a partner”, “change your life”, “make money effortlessly”,
  • offers them coupons, investment packages, participation certificates,
  • refers them to a website that does not contain much information or is “under construction”,
  • refers them to a website that is not in Polish (but is available in Ukrainian, Vietnamese, Indonesian etc.), and the company’s registered office is in an exotic country,
  • emphasises that the essential or most important condition for participating and obtaining remuneration is to persuade other people to join the scheme,
  • does not provide sources of the scheme financing or presents them vaguely.

 

Report the scheme to law enforcement agencies (police, prosecutor’s office).

 

Consumers should remember that:

  • cryptocurrency is not money,
  • cryptocurrency is not legal tender,
  • cryptocurrency is not legally protected,
  • cryptocurrency is not guaranteed by the Bank Guarantee Fund,
  • cryptocurrency accounts and portfolios are vulnerable to hacker attacks.

Additional information for the media:

UOKiK Press Office
Pl. Powstańców Warszawy 1, 00-950 Warszawa, Poland
Phone +48 695 902 088, +48 22 55 60 314
E-mail: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL

Tags: consumer warning

Attached files

 

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