ICN Holding, Part 2: How to Hide Money Without Attracting the Regulators
After reading the previous story about the ultra-shady ICN Holding, many were left with a lingering question: «What’s with this weird scheme involving a linked brokerage account? Don’t pyramids usually want to take the entire sum of money outright, not just 5% of the initial deposit + skimming 2% annually from the client’s personal IB account?»
That’s a completely valid question. At some point (before 2018), it seems ICN operated in a more «classic» way, accepting the full amount of client investments directly. But then something changed, and they switched to this bizarre scheme of «linked IB account + supposed margin loan in an offshore». Let’s try to figure out the reasons behind this scheme. I’ve heard two main explanations floating around:
🐌 Higher reliability for the client. This is what the consultant who helped me write the article insisted on: supposedly, truly wealthy people aren’t willing to send money directly to some shady company, but reliably transferring large capital to their own account with a well-known broker like Interactive Brokers – no problem!
🐌 Tax savings for the client. Just listen to the amusing explanations from Pavel Chernyshov (another MLM consultant tied to ICN) in this video: «On your IB account, they deliberately show zero profit so you pay less tax in Russia!» As I understand it, in private conversations with clients, consultants also transparently hint that there’s no need to tell the Russian tax inspector about the second, mythical offshore ICN account – «they won’t find out about it anyway».
But I have my own explanation, which seems much more logical to me. It appears that at some point, ICN Holding ran into serious issues with receiving and sending large payments through U.S. banks. After all, they only have an SEC license to manage client money in their personal accounts as an Advisor, not to operate as a full-fledged investment fund (accepting client money directly, pooling it, and managing it according to strategies in ICN’s own account).
I think around 2018, AML/KYC procedures at banks working with ICN tightened – and they started asking uncomfortable questions about large payments. «What’s the purpose of receiving this money? Where does it go afterward? How does this align with your activities as an advisor, and are you even allowed to do this?»
This is indirectly hinted at by the following clause in ICN Holding’s client contract:
3.4.3. If the Principal funds the integral investment account directly, this funding does not increase the size of the funds in their brokerage account. However, the amount of such funding to the integral account cannot exceed $9,999. Any funding above $10,000 must be made by the Principal only to their brokerage account.
Apparently, payments under $10,000 don’t get scrutinized by the bank’s compliance department, but anything above that might raise questions. I also was contacted by a subscriber who was an MLM consultant selling ICN programs for several years. Here’s what he told me in private about how withdrawals from the offshore portion of ICN’s «client accounts» work:
Regarding profit withdrawals. Their general policy is that withdrawals from integral accounts are limited to $5,000 within 30 days. They’re not allowed to do more. But they can do it through tricky schemes via a lawyer, and it’ll cost $200 + a percentage. I think it was about 1.5%, but it depends.
This is just wild. «We’re a solid, reputable firm with a license. If need be, we’ll return your money at $5,000 a month, because anything more doesn’t pass compliance!» And this, mind you, refers to the period before 2022 – when there were no sanctions. Now, as far as I know, ICN offers clients withdrawals in USDT for a modest additional fee of 2–3%. Very legit-looking, definitely no gray schemes here!
Also, please see the full story of the former ICN salesperson that he sent me below:
Hey, Pavel! You didn’t respond back in 2020 when I asked you about ICN, so I had to figure it out myself :) Over the next two years until 2022, I managed to be both an investor and a consultant, climbing to a decent position there.
As it often goes in MLM, it’s all about the people. I found a financial consultant’s blog that resonated with me, and I just wanted to do the same. I wanted to use their services to diversify my money and try consulting to diversify my work.
When he showed me ICN, the only thing that bothered me was the returns. The shady schemes, fine, the SEC supposedly keeps an eye on things. But their weird market reviews didn’t align with the returns of a financial genius in my worldview. They said the SEC checks all the info published on the company’s website, so I thought, okay, let’s roll :)
I ended up making one of the fastest career climbs in the company and realized the effort wasn’t really paying off. Like in any MLM, the real money comes from building a network. You need to constantly recruit new consultants who tap their inner circles, and that’s it. That’s how you earn more than if you bring in lots of clients yourself, even with money. It’s weird.
I wanted to earn from the growth of clients’ capital, as that’s how they initially sold it to me. But once I joined the company, the magical growth somehow dried up. Even according to ICN’s own reports (2020–2025). And, again, the consultant’s income structure is much more tied to expanding the network.
The cringe wasn’t just at the parties but also in the lectures :) They said it’s basic training, it sells to the masses, and it’s all normal here.
But the red flags kept piling up. Eventually, I attended what’s considered a prestigious training for top consultants, led by Kokorine himself. There was a bit less cringe, but the content was still generic portfolio theories like Markowitz and other market-common stuff.
Nothing that would show the genius of someone with such results over the long haul. On questions about the lack of drawdowns, just vague talk about hedging with options. That’s how they always save the day. But no nuances or details – it’s a «proprietary strategy» :) It’s the manager’s own money, and so on.
The portfolio management on IB always bugged me too. Okay, you’re not making returns there, but why do such nonsense? To cover a 2% margin loan (as they claimed back then), you could just buy Treasuries and not overthink it. But now the thing with their loan rate is also nonsense.
The number of red flags kept growing, the income dynamics weren’t great, so what’s the point? I stopped actively recruiting clients and focused on other things, eventually moving fully to independent trading.
Over the years, my clients gradually withdrew their money from there, and I didn’t stop them. There was no point holding them back, neither commercially nor personally. I myself slowly moved my money from there to my own IB account. But without raising suspicions. I just wasn’t satisfied with their results. All opportunities were missed under the pretext of «there’s going to be a crash soon, we don’t lose money, so we’re in cash.»
Meanwhile, I had about $15,000 left in the integral account. Over a couple of months, they sent it to me in several $5,000 tranches.
That’s the story in brief :)
Next part is here