SEC Can’t Find BitConnect Founder Convicted In $2.4 Billion Fraud Case

Indicted by the US Department of Justice in a $2.4 billion Ponzi scheme, BitConnect founder Satish Kumbhani remains missing after conviction.

In a court filing on Monday, the Securities and Exchange Commission said Kumbhani’s whereabouts remain unknown. The SEC noted that Kumbhani’s last known location was in his native India, but has gone unnoticed since the promoter of his BitConnect Ponzi scheme was sued by the SEC for defrauding US investors out of more than $2 billion.

SEC in his Submit noted that the convicted founder most likely fled to a foreign country and that “Kumbhani’s location is unknown and the Commission still cannot say when its efforts to locate him will succeed, if at all.” operating an unlicensed money transfer business, and three conspiracies: committing wire transfer fraud; manipulating raw material prices; and international money laundering

Related: SEC Charges $5 For Illegal Promoting $2 Billion Bitconnect Ponzi Scheme

The BitConnect saga dates back to the ICO era and was one of the most talked about and discussed projects at the time. Founded in 2016, the crypto project became a global sensation in mid-2017 when it raised billions of dollars from global investors. The project promised a lending program based on proprietary “trading bot” and “volatility software” that would provide 10% profit to investors via BCC token.

The DOJ accused Kumbhani of running a Ponzi scheme through BitConnect’s lending program, with the project managing to siphon $2.4 billion from investors. Bitconnect’s native token BCC registered a historically high trading price of $463.31 at the height of the market frenzy in December 2017, reaching a market cap of $3.4 billion.

The founders’ carpet withdrew the project in January 2018, pushing the token price to nearly zero and causing huge losses for investors.

BitConnect (BCC) price history. Source: CoinMarketCap

The DOJ also accused Kumbhani of creating a false market demand for BCC to lure more unsuspecting investors. The project, like many others in the ICO era, turned out to be a massive pyramid scheme where the creators used early funds to pay off old investors and later walked away after raising billions based on hype and ICO craze. † Several promoters of the project in Australia and the US have already been convicted and face jail time.

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