BitConnect Founder Indicted in $2.4B Ponzi Scheme Has Disappeared

UPDATE (March 1, 19:50 UTC): Corrects header and archetypal paragraph to accidental that Satish Kumbhani was indicted, not convicted, regarding a Ponzi scheme.

BitConnect laminitis Satish Kumbhani is obscurity to beryllium recovered a week aft being indicted successful the $2.4 cardinal Ponzi strategy that is said to person defrauded investors successful the U.S.

Kumbhani, an Indian citizen, was charged criminally by the U.S. Department of Justice past week. The Securities and Exchange Commission separately sued Kumbhani successful September 2021, claiming helium fraudulently raised much than $2 cardinal for BitConnect.

The occupation now? No 1 knows wherever Kumbhani is.

Officials said successful a legal filing connected Monday that Kumbhani has apt vanished from India and his whereabouts stay unknown. This follows from an October 2021 filing that said the SEC learned Kumbhani has apt relocated from India to an chartless code successful a antithetic country.

“The Commission did not cognize the whereabouts of Kumbhani, an Indian citizen, astatine the clip it filed this action, and BitConnect is an unincorporated entity the Commission indispensable service done its manager, Kumbhani,” said elder proceedings counsel Richard G. Primoff successful the filing.

“Since November, the Commission has been consulting with that country’s fiscal regulatory authorities successful an effort to find Kumbhani’s address,” Primoff added. “At present, however, Kumbhani’s determination remains unknown, and the Commission remains incapable to authorities erstwhile its efforts to find him volition beryllium successful, if astatine all.”

Primoff has asked U.S. District Judge John Koeltl for an hold until May 30.

BitConnect, founded successful 2016, was 1 of the biggest and astir fashionable projects successful the archetypal coin offering (ICO) rage successful mid-2017, raising billions of dollars from planetary investors for a protocol that purportedly paid retired 10% successful involvement net via its BCC token to investors, with users who “referred” different investors getting adjacent much benefits.

But BitConnect – which was progressively facing scrutiny from lawmakers and investors for its merchandise – saw level administrators closing the earning level connected Jan. 16, 2018. Prices of BCC plummeted to beneath $1 from a erstwhile precocious of astir $500 successful a fewer days aft the platform’s closure.

Such conditions kick-started a tribunal conflict successful the U.S. to bring to justness the founders of BitConnect, with Kumbhani and American national Glenn Arcaro astatine the halfway of the scheme. Arcaro pleaded guilty to transgression charges connected Sept. 1, 2021, with charges including conspiracy to perpetrate ligament fraud and transgression forfeiture.