According to the Australian SEC, John Bigatton, an Australian, promotes BitConnect without a license through two social media posts and four seminars.
An Australian citizen has entered a guilty plea for his participation in endorsing cryptocurrency lending services on behalf of the defunct cryptocurrency exchange Bitconnect. Bitconnect, which allegedly operated as a Ponzi scheme and ceased operations in 2018 on charges of defrauding over $2.4 billion from its victims, was notorious for its fraudulent activities.
“Without an Australian Financial Services license or authorization to provide financial services regarding the lending platform, Mr. Bigatton advised on financial products,” the Australian Securities and Exchange Commission (ASIC) stated in a statement dated May 17.
ASIC alleged that John Louis Anthony Bigatton, as BitConnect’s national promoter, provided financial product advice on six separate occasions, four seminars, and two social media posts, all in various locations across Australia.
“Mr Bigatton undertook promotional activities for BitConnect and the Lending Platform on social media, at seminars that he hosted at various locations around Australia, and through face-to-face meetings with investors.”
Appearing as an investment opportunity, the lending platform of BitConnect encouraged investors to purchase BitConnect coin (BCC) via its website.
BCC might be lent to investors for a specified period at exorbitant interest rates. They could only extricate their invested funds or exercise control over their loans once the lending period concluded. The IRS claims that this was allegedly established so that the BitConnect platform could function as a Ponzi scheme, paying early investors with funds from later investors.
On July 5, a sentencing hearing is scheduled.
BitConnect, which debuted in February 2016 and operated a digital currency and platform, ceased operations in January 2018; its founders ultimately vanished with their investors’ funds.
The United States District Court for the Southern District of California issued a restitution order of $17 million for the fraudulent scheme in January 2023, several years later.
A fraction of the multibillion-dollar BitConnect investment scheme fraud scheme found solace when a court ordered a portion of the $17 million restitution to a group of crypto fraud victims.
The current whereabouts of Satish Kumbhani, the originator, remain unknown.
