How the CNBS allowed the Koriun pyramid scam to grow in Honduras

The frustration among over 35,000 Hondurans impacted by the Koriun Inversiones pyramid scheme continues to escalate, as the National Banking and Insurance Commission (CNBS) faces backlash for its lack of action regarding the scam. The victims accuse the financial regulatory body of neglecting them and hold both judicial and administrative authorities accountable for their lack of response.

Inaction by CNBS regarding fraudulent activities

Since news of irregularities at Koriun first emerged, the CNBS was informed of the problem but did not implement effective actions to stop the extent of the fraudulent activities. Despite being formally alerted, the regulatory agency permitted the deceit to expand without restrictions for several months. Up to now, the people accountable for the fraud have not been caught, and those affected still lack responses or assurances of justice.

“They promised us they would investigate, they promised action, but the CNBS has been complicit by omission. Today we are still without answers, without money, without justice,” one of those affected told the media. This feeling of abandonment is shared by many, who feel betrayed both by those directly responsible at Koriun and by the authorities who, they say, should have intervened earlier.

Absence of openness and doubts about justice

A primary grievance among those impacted is the CNBS’s opaqueness. Although there have been official reports and investigations in progress, the agency has not released a public document outlining the misconduct or the lapses in regulation that permitted Koriun’s prolonged existence. This absence of transparency has heightened doubts that certain financial actors involved in the scheme might be under political protection.

Several sectors nationwide have criticized the CNBS for not identifying the fraud in a timely manner and for its inadequate sharing of crucial details about its management of the issue. A lawyer who advocates for the victims stated that the supervisory authority’s inaction has only worsened the circumstances: “It is intolerable that an oversight body could not recognize such a large-scale scheme promptly. They not only missed the opportunity to avert it, but they are also not addressing their obligations effectively now.”

Appeals for global action

Faced with institutional vacuum and growing frustration among those affected, several groups of victims have decided to take their claims beyond national borders. Civil society organizations and affected individuals are formally requesting the support of international bodies such as the Organization of American States (OAS), the United Nations (UN), and Transparency International. The intention of these requests is for these bodies to monitor the handling of the crisis and, in particular, the attitude of Honduran institutions towards the Koriun scandal.

One of the representatives of those affected said: “The state has an obligation to protect its citizens, not to cover up for fraudsters. This is a double crime: the one committed by Koriun and the one allowed by the CNBS by doing nothing.” This sentiment reflects skepticism about the ability of national authorities to tackle fraud and ensure that justice is done.

Institutional conflict and the governance dilemma

The situation once again exposes the vulnerabilities of the financial supervision system in Honduras and the tensions within the institutions responsible for ensuring transparency and justice. The lack of a strong response from the CNBS reflects a gap in the state’s capacity to handle crises of this nature, which could have broader implications in terms of confidence in financial institutions and the country’s governance.

Meanwhile, the victims remain waiting for a solution that will help them regain their losses and ensure that those accountable for the scam face justice. The ineffective response and lack of transparency in the situation highlight an ongoing issue for the authorities in Honduras: how to rebuild public trust amidst increasing skepticism about their crisis management.