BitConnect founder Satish Kumari was indicted by the United States Department of Justice for a Ponzi scheme worth $2.4 billion. He remains untraceable after his conviction.
The Securities and Exchange Commission stated Monday that Kumbhani’s whereabouts are unknown in a court filing. Kumbhani was last seen in India. However, the Securities and Exchange Commission stated that Kumbhani has not been found since BitConnect Ponzi scheme promoter was arrested by the SEC. He was accused of defrauding American investors totalling over $2 billion.
SEC filed a statement stating that the founder was most likely to have fled to a foreign land. “Kumbhani’s current location is unknown and the Commission cannot state when it will succeed in locating him, if any.” The founder is charged in wire fraud and operating an unlicensed money transmission business. He also faces three conspiracy charges: wire fraud; commodity price manipulation; international money laundering.
Related: 5 SEC officials are charged with illegally promoting the $2 billion Bitconnect Ponzi Scheme
The BitConnect saga goes back to the ICO-era. It was one of the most talked about and discussed projects at that time. The crypto project was founded in 2016 and became a worldwide sensation when it raised billions from global investors. The project promised to offer a lending program that was based on proprietary trading bots and volatility software. Investors would earn 10% via the BCC token.
Kumbhani was charged by the DOJ for operating a Ponzi scheme through BitConnect’s lending program, where it managed to siphon off $2.4 Billion from investors. Bitconnect’s native token BCC saw an all-time high trading price of $463.31 during December 2017, when the market was at its peak. It reached a market capital of $3.4 billion.
By January 2018, the founders had pulled the project apart, crashing the token price to almost zero and causing huge losses for investors.
Price history for BitConnect (BCC). Source: CoinMarketCap
Kumbhani was also accused by the DOJ of inflating BCC’s market demand to attract more investors. Like many other ICO-era projects, this was a huge pyramid scheme in which the creators used old investors’ funds to pay them off and then ran away with billions of dollars based on hype. . Numerous promoters of the project in Australia and the U.S. are already convicted and face jail time.