A. Executive Summary
1. The auditor explicitly excluded very important subjects from the scope of the audit, for instance:
- the consistency between the OneCoin End Balance of Blockchain Version 1 and the Start Balance of Blockchain Version 2
- the consistency of the audited blockchain data with the information and data visible on the front-end websites, onelife.eu among others.
NB: we found that the block height numbers (block sequence numbers) mentioned in the Audit Reports, match with the Block height numbers which are visible on the Blockchain browser screens.
2. The auditor accepts the data provided by One Network Services Ltd as correct and denies any responsibility concerning the data correctness.
3. There is no mention whatsoever of checks of the consistency between the OneCoin transactions in the Blockchain on the one hand and the OneCoin Transactions in the OneCoin and Coinsafe Accounts of OneLife members on the other hand.
4. Despite these limitations the auditor states in his OPINION that all transactions are recorded in the blockchain and are consistent.
Our opinion on the Audit Reports and the auditor:
a. All Audit Reports are worthless.
b. By explicitly limiting the scope of the audit the auditor could produce his reports without lying.
c. The audit firm S Systems Ltd as well as the auditor have zero credibility (we don’t know if this “Atanas Lazarov” really exists, as there is no proof that he has ever shown his face in public on any OneCoin/OneLife event).
B. Analysis of Audit Reports
These are screenshots of Page 2 and 4 of the October 2016 Audit Report:
After the launch of the “new and greatly enhanced blockchain” (according to OneCoin news that is) on 1 October 2016 it took more than six months until new Audit Reports were published.
Note: All Audit Reports are available for everybody who has a onelife.eu account. After login, go to > Information Center > COMPLIANCE > AUDIT, or use this hyperlink: COMPLIANCE/AUDIT (login required, opens in new window).
The “S Systems” company logo, the name of the auditor “Atanas Lazarov” and even the stamp with signature are pixel perfect copies of the Audit Reports which cover OneCoin Blockchain Version 1 in the period July 2015 till September 2016.
Note: Only the April 2015 till June 2015 Audit Reports have been produced by Dian Dimitrov of Semper Fortis.
Apart from Version Dates and “ultimo month block height numbers” (we will explain this term below) all reports are identical, so we will only discuss the October 2016 Audit Report in detail.
Report fragment – Part 1
“Our engagement as stated in the contract with One Network Services Ltd. is to perform audit of the OneCoin block chain in order to:
1) assess the consistency of the block chain and
2) verify that there are no transactions not included in the block chain.”
Our opinion – Part 1
Sub 1): Our own investigations reveal that the OneCoin “Blockchain” is internally consistent, by which we mean:
- There is a continuous chain of Blocks, connected by “next” and “previous” hyperlinks, which can be browsed through from the very first “genesis block” with Block height #0 until the most recently created Block.
- Each block contains 1 and only 1 transaction with 50,000 newly “mined” OneCoins (the mining process is fake though).
- All input amounts of Transactions can be traced back to an output amount of (an) earlier transaction(s). The original source of all OneCoins, if you follow the trail to earlier Transactions, always is a 50000 ONE mining transaction or the genesis block.
- We never found output amounts which are used more than once as input amounts in later Transactions. In general cryptocurrency terms: there are no “double spends”.
The only “issue” is: the Transactions in the Blockchain have no connection whatsoever with the OneCoin transactions in the OneCoin and Coinsafe Accounts of OneLife members. In other words: all Transactions in the Blockchain are generated by blockchain simulation software and are fake.
Sub 2): in our opinion this a nonsensical statement.
Example of a Transaction to illustrate the concept of Transaction Inputs and Transaction Outputs. Transaction in Block 17357
Report fragment – Part 2
“We have performed automated tests on the block chain and transactions databases provided to us by One Network Services Ltd. as of block with height 42 801 (forty-two thousand eight hundred and one).”
Our opinion – Part 2
The Block with height 42801 which is visible in the Blockchain viewer has Date/Timestamp 01/10/2016 23:59:58 so this is indeed the last block created in October 2016. See direct hyperlink (login required): Block height #42801
The same goes for the block height numbers mentioned in the five Audit Reports from November 2016 till March 2017, they are always the last Transaction created in the month or on the day after. This makes it very likely that the auditor has seen the same data which are visible on the Blockchain screens.
Screenshot of Block Height Number #42801 mentioned in the October 2016 Audit Report. Note the Date/Timestamp: 31/10/2016 23:59:58
This table gives a summary of the Block Height Numbers mentioned in the Audit Reports, the Date/Timestamp of the corresponding Block on the Blockchain Simulator screen and a direct hyperlink to the Block.
|Audit Report||Block Height
|Date/Timestamp||Hyperlink to Block|
|31 October 2016||42801||01/10/2016 23:59:58||Block height #42801|
|30 November 2016||84890||01/12/2016 00:00:37||Block height #84890|
|31 December 2016||129205||01/01/2017 13:16:22||Block height #129205|
|31 January 2017||171066||31/01/2017 09:02:39||Block height #171066|
|28 February 2017||209401||01/03/2017 00:00:51||Block height #209401|
|31 March 2017||252055||31/03/2017 23:59:02||Block height #252055|
Report fragment – Part 3
“As of 01 October 2016 a completely new block chain is used. This block chain (in effective use after 01 October 2016) is not related by any means to the old one (in use before 01 October 2016) and have no information for any transactions that have occurred before 01 October 2016. No direct link between the two block chains exist nor is subject of our tests.”
Our opinion – Part 3
This complies with our findings:
- The “genesis block” with height #0 in Blockchain Version 2 does not contain a “previous” hyperlink.
- The “genesis block” has only 1 Transaction; this Transaction does not have an Input amount, only an Output Amount (1,986,580,000 ONE).
- All old hyperlinks of blockchain Version 1 we have saved, don’t work anymore, i.e. old Block and Transaction data are currently not accessible.
Report fragment – Part 4
“The transfer (migration) of the coin amounts from the old to the current block chain is by pre-mining the relevant quantities in the genesis block of the current block chain.
We have performed no procedures and do not express any assurance or opinion whether the operation quoted (the coin amount transfer) is correct and the transferred amounts are identical with the previous ones.”
Our opinion – Part 4
The first thing a professional auditor should check is the consistency between the old (Version 2) and the new (Version 1) Blockchain because this is of utmost importance. The End Balance in each and every OneCoin and Coinsafe Account in Version 1 must be equal to the Start Balance in Version 2. However this auditor explicitly excludes this crucial subject from the scope of his investigations.
This is a screenprint of one of the OneLife accounts we have used for our own investigations:
On 5 December 2016 a new version of the onelife.eu backend was launched which only shows dates without times, but this screenshot in the old layout above clearly shows that the transactions in the OneCoin Account have a Date & Timestamp 1 October 2016 00:00:01 and 00:00:02 GMT/UTC respectively, so directly after midnight.
The so-called “mining” of the genesis block took place 9.5 hours later at 09:31:13 GMT/UTC which is clearly visible on this screenshot:
This is irrefutable proof that the “mining” of the genesis block in the presence of “Dr” Ruja Ignatova during the Bangkok event was one big show. There was no “pre-mining”, all transactions for migrations of coins and “coin doubling” were already registered in the OneCoin account long before. The “pre-mined genesis block” has no connection whatsoever with member’s OneCoin and Coinsafe accounts. This sentence in the Audit Reports is nonsense:
- “The transfer (migration) of the coin amounts from the old to the current block chain is by pre-mining the relevant quantities in the genesis block of the current block chain.”
Report fragment – Part 5
“Our tests are performed on the data provided to us by One Network Services Ltd. We accept this data as correct and we hold no responsibility concerning the data correctness. Our engagement is based only on the data provided by the Client and no third party sources are used.”
Our opinion – Part 5
The One Network Services Ltd company gives the auditor access to the Block and Transaction data of the OneCoin Simulator and the auditor, without any further investigation, assumes that these data are correct. This way he can write his Audit Reports without lying, sort of smart but also obvious if you see through the patterns.
Report fragment – Part 6
“We preform our tests on the data provided by One Network Services Ltd. and we perform no procedures nor express any opinion on whether the information subject of our tests (the block chain effectively in use after 01 October 2016) is consistent with the information and data visible on the front-end websites (onecoin.eu, onelife.eu or any other).”
Our opinion – Part 6
This is more evidence that the auditor does not do anything to check the consistency with the informattion in the OneCoin and Coinsafe Accounts of OneLife members.
If you audit fake blockchain data which – considered on its own – seem to be consistent and complete, the results are worthless Audit Reports.
Screenshot of Block Height Number #84890 mentioned in the November 2016 Audit Report
Screenshot of Block Height Number #129205 mentioned in the December 2016 Audit Report:
Screenshot of Block Height Number #171066 mentioned in the January 2017 Audit Report:
Screenshot of Block Height Number #209401 mentioned in the February 2017 Audit Report:
Screenshot of Block Height Number #252055 mentioned in the March 2017 Audit Report: