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Good news to Bitconnect-fraud victims

bitconnect

TL;DR Breakdown

  • 800 Bitconnect-fraud victims will be eligible to receive a share in a $17 million restitution.
  • The cryptocurrency platform began operations in 2016 but shut down in 2018 after looting $2.4 billion from more than 4,000 users in 95 countries.

Cryptocurrency fraud victims of the BitConnect investment scheme will experience some relief from the multi-billion dollar fraud operation after a judge mandated that they get a portion of a $17 million restitution.

According to a statement made by the Department of Justice (DOJ) on the same day, the United States District Court for the Southern District of California ordered compensation for the “massive” fraud on January 12. 

800 victims of the scheme, who come from 40 different countries, will be eligible to receive a tiny portion of the $17 million in restitution, which is the process of repaying the rightful owner of the property or the full amount of losses.

Bitconnect looted up to $2.4 billion

According to the DOJ statement, the cryptocurrency platform was a fictitious platform for cryptocurrency lending that advertised its own proprietary technologies, such as the “Bitconnect Trading Bot” and “Volatility Software,” which promised investors guaranteed profits. It guaranteed a return of 1% per day on average, or 3,700% yearly.

Investors would exchange Bitcoin for Bitconnect Coin (BCC), which could then be lent out at various interest rates.

 

“As early investors were rewarded with funds generated by new investors, the entire network ended up being a textbook Ponzi scheme.”

The cryptocurrency platform began operations in 2016 but shut down in 2018 after looting $2.4 billion from more than 4,000 users in 95 countries. The DOJ filed charges against Satish Kumbhani, the purported founder of Bitconnect, in February 2022. In India, he is also the focus of a police inquiry, and it is now unknown where he is.

Glenn Arcaro, the leading Bitconnect promoter headquartered in the United States, admitted guilt to charges of conspiring to commit wire fraud in September 2021 and was ordered to repay investors $24 million.

The DOJ alleges that Arcaro and others utilized 15% of Bitconnect investor funds for a slush fund that was used for the owner and other promoters of the company. Arcaro received a 38-month prison term on September 16, 2022, for his involvement in Bitconnect.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

Lacton Muriuki

Lacton Muriuki

Lacton is an experienced journalist specializing in blockchain-based technologies, including NFTs and cryptocurrency. He dabbles in daily crypto news rich with well-researched stats. He adds aesthetic appeal, adding a human face to technology.

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