Australian Court Convicts Former BitConnect Promoter

The Sydney District Court found Australian promoter of the fraudulent $2.4 billion BitConnect scheme, John Bigatton, guilty of providing unlicensed financial services.

The man was sentenced to three years of restricted freedom on the condition of good behavior. For five years, he will be barred from managing any business.

According to court documents, the project offered the purchase of BitConnect Coin (BCC) tokens to participate in high-yield investment opportunities.

From August 2017 to January 2018, Bigatton promoted the scheme in Australia through seminars and social media.

At least during two events, the defendant claimed that the value of BCC would rise from $253 to $1000 within a year. At another seminar, he described these investments as surpassing “any term deposit.”

The Australian Securities and Investments Commission (ASIC) charged Bigatton in November 2020. The regulator’s claims concerned the servicing of an unregistered investment offer and providing financial services without a license. The scheme’s promoter faced up to five years in prison.

“Providing unlicensed financial advice deprives investors of access to key protections and undermines confidence in the industry. ASIC is committed to taking action against the illegal promotion of high-risk digital assets to protect Australian users,” said Deputy Chair Sarah Court.

In January 2018, a class-action lawsuit was filed against BitConnect in the US, accusing it of creating a “wide-ranging Ponzi scheme.”

In May 2021, the local Securities and Exchange Commission (SEC) brought claims against five promoters of the project in the country.

Four defendants reached a settlement, and in August, the regulator won the court case. In September, former BitConnect director Glenn Arcaro pleaded guilty to participating in the fraudulent scheme, which caused an estimated $2.4 billion in damages.

In February 2022, charges were brought against the project’s founder, Satish Kumbhani, for organizing the Ponzi scheme. However, this was done in absentia, as his whereabouts were unknown at the time.