Brazil mining company Minerworld has allegedly come out and stated that it does not have the funds to pay back investors, according to Brazilian news source Cripto Noticias.
The mining company has stated that it does not have the bitcoin required to pay users who invested following an announcement in September stating the company would be paying investors back. Due to ta recent court order that required Minerworld to use its remaining funds to compensate investors. Minerworld however, admits that it does not have any balance to pay back the investors.
According to news sources the remaining funds from Minerworld were spent to "maintain their minimum functioning, resignation of officials and contractual terminations with service providers"
Reports suggest that over 50,000 investors are affected. Brazil's justice system is currently prosecuting Minerworld for operating as a ponzi scheme. The company rebuttals this by stating that they operate their business as a multi-level marketing (MLM) practice by offering investors 100% returns, fancy cars and holidays.
However the red flags for this company are everywhere. Authorities in Paraguay have also accused the company of being a hoax and operating as a "front company"