Former BitConnect director barred for life from participating in ICOs

Verdict handed down against Glenn Arcaro and Future Money Ltd. in the BitConnect case.

The United States District Court for the Southern District of New York issued a verdict against former BitConnect director and promoter Glenn Arcaro, and the affiliated company Future Money Ltd., through which he attracted potential investors.

The judge agreed with the SEC‘s arguments that the defendants were not registered as broker-dealers, violated anti-fraud provisions, and securities and exchange laws.

Under the court’s order, Glenn Arcaro and Future Money are barred for life from directly or indirectly participating in initial coin offerings (ICOs) and certain marketing campaigns.

The defendants are also ordered to compensate victims for losses with interest up to the date of the verdict. They may subsequently be fined civilly, the amount to be determined by the court upon the SEC’s motion.

Back in January 2018, BitConnect was accused of creating a financial pyramid scheme. At the height of its popularity, the project’s native coin traded above $500 and ranked in the top ten on CoinMarketCap.

The SEC filed a civil complaint against Glenn Arcaro, BitConnect founder Satish Kumbhani and Future Money in September 2021. The regulator alleged that the group conducted a fraudulent, unregistered sale of securities totaling $2 billion through the BitConnect lending program.

Earlier Arcaro pleaded guilty to participating in a fraudulent scheme. The court ordered him to pay investors $24 million.

The regulator also reached agreements with three participants in the fraudulent scheme, who agreed to reimburse damages and pay penalties totaling about $13 million.

In November, the U.S. Department of Justice and the U.S. Attorney’s Office for the Southern District of California announced plans to sell $56 million of cryptocurrency seized from Glenn Arcaro. The proceeds will be used to compensate affected BitConnect investors.

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