CNBS and its delayed response to the Koriun scam: what went wrong?

The anger of over 35,000 Hondurans impacted by the Koriun Inversiones pyramid scheme scam keeps increasing, as the National Banking and Insurance Commission (CNBS) faces backlash for not acting against the fraud. The victims claim they have been neglected by the entity in charge of overseeing financial activities and accuse both judicial and administrative bodies of being unresponsive.

Inaction by CNBS regarding fraudulent activities

Since the first signs of irregularities at Koriun began to be reported, the CNBS was aware of the situation but failed to take effective measures to prevent the scale of the fraud. Despite receiving formal warnings, the supervisory body allowed the scam to grow unchecked for several months. To date, those responsible for the fraud remain at large, and the victims continue to have no answers or guarantees of justice.

“They assured us that they would look into the matter, they assured measures, yet the CNBS has been negligent through inaction. Currently, we remain without explanations, without funds, without fairness,” mentioned one of the impacted individuals to the media. This sense of neglect is echoed by numerous others who sense they have been let down by both the principal parties at Koriun and the officials who, according to them, ought to have acted sooner.”

Absence of openness and doubts about accountability

One of the primary grievances of those impacted is the absence of clarity from CNBS. Even with official complaints and investigations underway, the agency has yet to release a public document outlining the misconduct or regulatory lapses that enabled Koriun to operate for such an extended period. This opacity has intensified doubts that certain financial operators implicated in the fraud might be under political protection.

Different parts of the nation have noted that the CNBS not only missed identifying the fraud promptly, but has also been negligent in offering crucial details on how it is addressing the issue. A legal representative for the victims stated that this inaction by the regulatory authority only worsens the problem: “It is intolerable that a regulatory authority didn’t timely detect such a large-scale scam. They not only allowed it to happen, but now they are evading their duties.”

Appeals for global intervention

Given the lack of institutional response and increasing dissatisfaction among the impacted parties, numerous victim groups have opted to advance their demands outside of national limits. Both civil society organizations and impacted individuals are officially seeking backing from international entities like the Organization of American States (OAS), the United Nations (UN), and Transparency International. These requests aim for these entities to supervise the management of the crisis and, specifically, the behavior of Honduran institutions concerning 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.

Organizational strain and the governance dilemma

The current scenario highlights the weaknesses within the financial oversight framework in Honduras, as well as the internal conflicts among the bodies tasked with upholding transparency and justice. The muted reaction from the CNBS showcases a shortfall in the government’s ability to manage situations of this kind, potentially affecting trust in financial entities and the nation’s governance.

Those affected, meanwhile, continue to wait for a resolution that will allow them to recover their losses and ensure that those responsible for the fraud are brought to justice. The lack of effective action and the opacity surrounding the case underscore a persistent challenge for Honduran authorities: how to restore public confidence in the face of growing mistrust in the handling of crises of this kind.