Founded in 2016, the crypto venture grew to became a world sensation by mid-2017 as it raised billions of greenbacks from global traders. The venture promised a lending program basically based totally on proprietary “trading bot” and “volatility instrument” that might possibly well supply 10% earning to traders by task of BCC token.

The DOJ charged Kumbhani for running a Ponzi draw by task of BitConnect’s lending program where the venture managed to siphon off $2.4 billion from traders. Bitconnect’s native token BCC recorded an all-time-excessive trading impress of $463.31 at the height of the market frenzy in December 2017 reaching a market cap of $3.4 billion.


Founded in 2016, the crypto project became a global sensation by mid-2017 as it raised billions of dollars from global investors. The project promised a lending program based on proprietary “trading bot” and “volatility software” that would offer 10% earning to investors via BCC token.

The DOJ charged Kumbhani for running a Ponzi scheme via BitConnect’s lending program where the project managed to siphon off $2.4 billion from investors.
Bitconnect’s native token BCC recorded an all-time-high trading price of $463.31 at the peak of the market frenzy in December 2017 reaching a market cap of $3.4 billion.

The founders rug pulled the project by January 2018, crashing the token price to near zero and causing massive losses to investors.

The DOJ also accused Kumbhani of creating fake market demand for BCC to lure more unsuspecting investors.

Kumbhani and his co-conspirators also concealed the location and control of the fraud proceeds obtained from investors by commingling, cycling, and exchanging the funds through BitConnect’s cluster of cryptocurrency wallets and various internationally based cryptocurrency exchanges.

According to the indictment, to avoid regulatory scrutiny and oversight of BitConnect’s cryptocurrency offering, Kumbhani evaded US regulations governing the financial industry, including those enforced by the Financial Crimes Enforcement Network (FinCEN).

For example, although BitConnect operated a money transmitting business through its digital currency exchange, BitConnect never registered with FinCEN, as required under the Bank Secrecy Act.

“Crime, particularly crime involving digital currencies, continues to transcend international boundaries,” said Assistant Attorney General Kenneth A.

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Polite Jr. of the Justice Department’s Criminal Division.

“The department is committed to protecting victims, preserving market integrity, and strengthening its global partnerships to hold accountable criminals engaging in cryptocurrency fraud.”

Read: ‘Missing’ BitConnect founder presents more questions than answers for SEC (March 1, 2022)

“Dressing up a tried and true fraud scheme with a new twist and basing it overseas will not deter the resolve and dedication of the FBI to meticulously investigate and bring such fraudsters to justice,” said Special Agent in Charge Eric B.

The SEC has always maintained that interest-bearing accounts are under its purview, which has seen it crack the whip on Coinbase for attempting to launch such a product and settle for $100 million with BlockFi for its existing lending products.

However, when the DoJ launched its criminal proceedings against Kumbhani, Judge Koeltl halted the SEC’s civil case.

In its latest filing, the SEC asked Judge Koeltl for a 90-day extension, up until May 30. While this limit doesn’t apply to service in another country, the SEC says it can’t rule out that Kumbhani could be living in the United States.
Should it be able to locate him inside the U.S., it will serve him with its complaint.

India, nonetheless has remained untraced ever since the promoter for his BitConnect Ponzi plan used to be charged by the SEC for defrauding American merchants of over $2 billion.

SEC in its filing great that the convicted founder has most potentially fled to a international nation and “Kumbhani’s location remains unknown, and the Commission remains unable to assert when its efforts to detect him will establish success, if at all.” The founder is charged with wire fraud, running an unlicensed cash transmitting industry, and three conspiracies: committing wire fraud; commodity label manipulation; and world cash laundering

Linked: SEC charges 5 for illegally selling $2 billion Bitconnect Ponzi plan

The BitConnect saga dates encourage to ICO-technology and used to be amongst basically the most highlighted and talked about initiatives at the time.

Founded in 2016, the crypto project became a global sensation by mid-2017 as it raised billions of dollars from global investors. The project promised a lending program based on proprietary “trading bot” and “volatility software” that would offer 10% earning to investors via BCC token.

The DOJ charged Kumbhani for running a Ponzi scheme via BitConnect’s lending program where the project managed to siphon off $2.4 billion from investors.
Bitconnect’s native token BCC recorded an all-time-high trading price of $463.31 at the peak of the market frenzy in December 2017 reaching a market cap of $3.4 billion.

The founders rug pulled the project by January 2018, crashing the token price to near zero and causing massive losses to investors.

The DOJ also accused Kumbhani of creating fake market demand for BCC to lure more unsuspecting investors.

A federal grand jury in San Diego returned an indictment today charging the founder of BitConnect with orchestrating a global Ponzi scheme. BitConnect is an alleged fraudulent cryptocurrency investment platform that reached a peak market capitalization of $3.4 billion.

According to court documents, Satish Kumbhani, 36, of Hemal, India, the founder of BitConnect, misled investors about BitConnect’s “Lending Program.” Under this program, Kumbhani and his co-conspirators touted BitConnect’s purported proprietary technology, known as the “BitConnect Trading Bot” and “Volatility Software,” as being able to generate substantial profits and guaranteed returns by using investors’ money to trade on the volatility of cryptocurrency exchange markets.

India, but has remained untraced ever for the explanation that promoter for his BitConnect Ponzi draw became as soon as charged by the SEC for defrauding American traders of over $2 billion.

SEC in its filing eminent that the convicted founder has most presumably fled to a international nation and “Kumbhani’s draw remains unknown, and the Fee remains unable to disclose when its efforts to stumble on him will prevail, if at all.” The founder is charged with wire fraud, working an unlicensed cash transmitting industry, and three conspiracies: committing wire fraud; commodity impress manipulation; and global cash laundering

Associated: SEC costs 5 for illegally promoting $2 billion Bitconnect Ponzi draw

The BitConnect saga dates abet to ICO-abilities and became as soon as among the many most highlighted and talked about initiatives at the time.

Eric Smith, a special agent in charge of the FBI’s Cleveland Field Office, noted:

“Today’s indictment reiterates the FBI’s commitment to identifying and addressing bad actors defrauding investors and sullying the ability of legitimate entrepreneurs to innovate within the emergent cryptocurrency space.”

Ryan Korner, a special agent in charge of the IRS Criminal Investigation’s office in Los Angeles, added:

“As cryptocurrency gains popularity and attracts investors worldwide, alleged fraudsters like Kumbhani are utilizing increasingly complex schemes to defraud investors, oftentimes stealing millions of dollars.”

Kumbhani’s indictment comes months after crypto worth $57 million was seized from Glenn Arcaro, a top American-based BitConnect promoter.

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