Bitconnect Victims to Receive Over $17 Million in Restitution From Ponzi Scheme – Bitcoin News
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More than $17 million in refunds will be distributed among investors in the Bitconnect pyramid scheme, as ordered by a US court. A notorious crypto investment scheme defrauded thousands of people around the world.
Bitconnect investors from dozens of countries to be paid back millions of US dollars
A total of more than $17 million in restitution will be returned to about 800 victims from more than 40 countries who lost money to Bitconnect, the US Department of Justice (DOJ) announced Thursday, citing an order from the federal district court in San Diego. A large-scale crypto investment scheme defrauded thousands of investors worldwide.
The sentence came after on September 16, 2021, US-based lead promoter of Bitconnect, 44-year-old Glenn Arcaro, pleaded guilty to conspiracy to commit wire fraud. He admitted to marketing Bitconnect’s initial coin offering and digital currency exchange as a profitable investment with the goal of capitalizing on investor interest in cryptocurrencies.
Arcaro and his co-conspirators misled investors about Bitconnect’s “lending program” and its allegedly patented “Bitconnect Trading Bot” and “volatility software” technologies, which they claimed could generate guaranteed returns on investors’ money used to trade crypto exchanges. .
“In reality, however, Bitconnect operated a textbook Ponzi scheme by paying early Bitconnect investors with the money of later investors. Arcaro and his co-conspirators ensured that up to 15% of the money invested in Bitconnect went directly into a slush fund to be used for the benefit of its owner and promoters,” the DOJ explained.
Los Angeles resident Glenn Arcaro was sentenced to 38 months in US federal prison in September 2022. He admitted to making at least $24 million from the scam. At the time, the DOJ noted that all of that money would be paid back to investors or forfeited to the government. In November of the previous year, the Justice Department had offered for sale $56 million worth of crypto assets seized from Bitconnect.
On February 25, 2022, Cryptopyramid’s founder, Indian national Satish Kumbhani, was indicted for his central role in organizing a $3.4 billion fraud scheme. Indian police launched an investigation into Bitconnect in August and are looking for its perpetrator. If convicted in the United States, he faces up to 70 years in prison.
Do you think Bitconnect investors will get additional compensation for their Ponzi scheme losses? Let us know in the comments section below.
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