SEC Cannot Identify Founders of Ponzi BitConnect

The whereabouts of BitConnect founder Satish Kumbhani, who has been indicted by the US Department of Justice (DOJ) in a $2.4 billion Ponzi scheme, remains unknown as of September 2021.

In one registration form The Securities and Exchange Commission (SEC) said in court on Monday (February 28) that Kumbhani’s whereabouts are still unknown. Kumbhani’s last whereabouts were in his native India, but he has been missing since he was indicted by the SEC for defrauding American investors out of more than $2 billion.

In the filing, the SEC notes that Kumbhani may have fled abroad and that “Kumbhani’s whereabouts have yet to be determined and the Commission still cannot say when efforts to locate him will be successful.”

Kumbhani was charged with money transfer fraud, operating an unlicensed money transfer business and three counts of conspiracy: committing wire fraud, manipulating commodity prices and international money laundering.

BitConnect’s history dates back to the ICO boom, which was one of the most talked about and debated projects at the time. Founded in 2016, BitConnect became a stunner in mid-2017, raising billions of dollars from global investors. The project promises a lending program based on a proprietary “trading bot” and “volatility software” that will bring investors 10% income through their BCC token.

BCC met ATH in December 2017

The DOJ hired Kumbhani to run a Ponzi scheme through BitConnect’s lending program, where the project has attracted $2.4 billion from investors. Bitconnect’s BCC token recorded an all-time high (ATH) of $463.31 with a market cap of $3.4 billion when the entire crypto market exploded in December 2017.

The BitConnect founders pulled the carpet in January 2018, causing BCC’s price to drop to near zero and causing huge losses to investors.

BitConnect (BCC) price chart | Source: CoinMarketCap

The DOJ also accused Kumbhani of creating fake market demand for BCC to attract more unsuspecting investors. As with many other projects in the ICO era, BitConnect turned out to be a giant pyramid scheme where the founders used the initial funds to repay old investors and then ran away after raising billions of dollars based on ICO hype and collected hype.

Several people who promoted the project across Australia and the United States have been convicted and face prison terms.

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