Fun

$2 Billion Crypto Fraud Bitconnect and Founder Charged — Director Pleads Guilty to Criminal Charges

News Feed - 2021-09-03 08:09:56

$2 Billion Crypto Fraud Bitconnect and Founder Charged — Director Pleads Guilty to Criminal Charges


The $2 billion crypto fraud scheme Bitconnect and its founder have been charged in the U.S. In a parallel enforcement action, a Bitconnect director and top promoter has pleaded guilty to criminal charges in the U.S. “The Bitconnect scheme is believed to be the largest cryptocurrency fraud ever charged criminally,” said the U.S. Department of Justice (DOJ). US Authorities Take Action Against Bitconnect and Its Founder


U.S. authorities continue to take action against the fraudulent crypto trading scheme Bitconnect and its executives this week. “The Bitconnect scheme is believed to be the largest cryptocurrency fraud ever charged criminally,” the DOJ described.


The U.S. Securities and Exchange Commission (SEC) announced Wednesday that it has filed an action against Bitconnect, its founder Satish Kumbhani, its top U.S. promoter Glenn Arcaro, and his affiliated company Future Money Ltd. The SEC noted that Kumbhani, age 35, is an Indian citizen who resided in Surat, India, but whose current whereabouts are unknown.


According to the Commission: They defrauded retail investors out of $2 billion through a global fraudulent and unregistered offering of investments into a program involving digital assets.


The SEC’s complaint, filed in the U.S. District Court for the Southern District of New York, explains that from early 2017 through January 2018, the “Defendants conducted a fraudulent and unregistered offering and sale of securities in the form of investments in a ‘Lending Program’ offered by Bitconnect.”


The SEC states that the Bitconnect Lending Program “ultimately succeeded in obtaining more than 325,000 bitcoin” from investors worldwide.


The complaint alleges that the “defendants falsely represented, among other things, that Bitconnect would deploy its purportedly proprietary ‘volatility software trading bot’ that, using investors’ deposits, would generate exorbitantly high returns.” The Commission added: Bitconnect and Kumbhani established a network of promoters around the world, and rewarded them for their promotional efforts and outreach by paying commissions, a substantial portion of which they concealed from investors.


“The SEC’s complaint charges [the] defendants with violating the antifraud and registration provisions of the federal securities laws. The complaint seeks injunctive relief, disgorgement plus interest, and civil penalties,” the Commission continued.


The regulator previously reached settlements with two of the five individuals it charged in connection with promoting the Bitconnect scheme. Top US Director and Promoter of Bitconnect Pleads Guilty to Criminal Charges


In a parallel action, the Department of Justice announced Wednesday that Arcaro, a Bitconnect director and the top U.S. promoter of the scheme, has pleaded guilty to criminal charges. The DOJ described: Arcaro admitted that he earned no less than $24 million from the Bitconnect fraud conspiracy, all of which, according to court documents, he must repay to investors.


The Justice Department detailed that the maximum penalty for Arcaro is “Twenty years in prison, $250,000 fine or twice the gross gain or loss from the offense, whichever is greater; forfeiture and restitution.”


What do you think about the U.S. authorities’ action against Bitconnect and its executives? Let us know in the comments section below. Seychelles Law Enforcement Receives Request to Probe Transfer of 230K Onecoin Bitcoins REGULATION | 2 days ago Biden Administration Pushes Global Crypto Data Sharing Rules in $3.5 Trillion Budget Bill: Report REGULATION | 2 days ago Tags in this story BitConnect, bitconnect charged, bitconnect charges, bitconnect criminal, bitconnect fraud, bitconnect guilty, doj bitconnect, sec bitconnect


Image Credits: Shutterstock, Pixabay, Wiki Commons Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments

News Feed

Why Isn’t XRP Skyrocketing? Expert Explains The Hidden Forces
Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and pu
DOJ Seizes $500K in Ransom Payments, Cryptocurrency From State-Sponsored North Korean Hackers
DOJ Seizes $500K in Ransom Payments, Cryptocurrency From State-Sponsored North Korean Hackers The U.S. Department of Justice (DOJ) has seized $500K in ransom payments and cryptocur
Tom Mitchelhill7 hours agoSBF was ‘very resistant’ to investors on FTX board: Paradigm co-founderMatt Huang said he was led to believe that Alameda Research was not being provided any special treatment by FTX.1812 To
Altseason is coming — or at least data suggests that its close
Nancy Lubale6 hours agoAltseason is coming — or at least data suggests that its closeCrypto traders and several metrics suggest that an altcoin season is about to begin.2068 Total views8 Total sharesListen to article 0
Bitcoin, Ethereum Technical Analysis: ETH Moves to 2-Month High Above $1,900 
Bitcoin, Ethereum Technical Analysis: ETH Moves to 2-Month High Above $1,900  Ethereum surged to a two-month high above $1,900 on Thursday, as the token continued to rally followi
David Attlee14 hours agoZimbabwe turns gold-backed digital token into payment methodThe Reserve Bank of Zimbabwe first introduced its new project in April, with each issued digital token backed by a physical amount of go
Robinhood Raises $323 Million, Still Worth Less Than Coinbase
Robinhood has raised a colossal $323 million in its latest funding efforts, making the millennial-focused stock-and-crypto trading app worth approximately $7.6 billion. Despite its mainstream appeal, the “no commis
Cointelegraph Innovation Circle9 hours ago10 obstacles to cross-chain interoperability (and how they can be overcome)Cross-chain operability may only be achieved when there’s not only a way, but a will to move forward.
Bill on Digital Ruble Submitted to Russian Parliament
Bill on Digital Ruble Submitted to Russian Parliament A draft law devoted to the digital ruble has been filed with the State Duma, the lower house of Russian parliament. The legisl
Controversial Ukrainian Oligarch Is Reportedly Mining Bitcoin in the US
Controversial Ukrainian Oligarch Is Reportedly Mining Bitcoin in the US One of the wealthiest oligarchs in Ukraine and a former governor in one of the country&rs
OKX Ventures invests in Web3 ‘play ARPG to train AI’ game Blade of God X
Tristan Greene7 hours agoOKX Ventures invests in Web3 ‘play ARPG to train AI’ game Blade of God XThe game is currently available in early access on the Epic Games Store.1142 Total views5 Total sharesListen to article
XRP Dump? Not So Fast—Software Engineer Says Panic Selling Makes No Sense
Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and pu