BitConnect founder indicted for $2.4 billion crypto fraud

A San Diego federal grand jury indicted BitConnect founder Satish Kumbhani on $2.4 billion Ponzi-scheme fraud, according to the Министерство юстиции США.

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According to court documents, Kumbhani and his co-conspirators promised investors substantial guaranteed returns through trading in the volatile cryptocurrency markets.

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The BitConnect project operated as a Ponzi scheme, paying earlier investors with money from later participants, the indictment states. In total, Kumbhani and his associates allegedly received about $2.4 billion from investors.

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The U.S. Department of Justice added that the defendant allegedly created false market demand for the BitConnect Coin (BCC) through a network of promoters.

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According to the department, the defendant is a citizen of India and remains at large. He faces up to 70 years in prison if convicted on all counts.

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As previously reported, in January 2018 BitConnect faced accusations of running a pyramid scheme. At the height of its popularity, the token price exceeded $500, helping it reach the top 10 of CoinMarketCap.

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In September 2021, the U.S. Securities and Exchange Commission filed a civil lawsuit against BitConnect, Satish Kumbhani, former director Glenn Arcaro and the affiliated company Future Money.

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The regulator accused the group of fraudulent and unregistered securities offerings totalling $2 billion through the project’s lending program. In December, Arcaro permanently barred from participating in the ICO.

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