BitConnect founder Satish Kumbhani has been indicted by a San Diego jury for allegedly orchestrating a global cryptocurrency Ponzi scheme that involved approximately $2.4 billion taken from investors. Kumbhani is currently at large.
The Justice Department said the 36-year-old has been charged with conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodity price manipulation, operation of an unlicensed money transmitting business, and conspiracy to commit international money laundering.
He is facing up to 70 years in prison if convicted on all the charges.
BitConnect was a fraudulent cryptocurrency investment platform launched in 2016 that the DOJ said reached a peak market capitalization of $3.4 billion.
Kumbhani managed to convince investors to contribute to the company’s lending program, which he said involved proprietary technology called “BitConnect Trading Bot” and “Volatility Software.” Kumbhani falsely told investors that he could guarantee profits by using investor funds to trade cryptocurrency based on the volatility of the market.
After a year, Kumbhani shut down the Lending Program but figured out a way to manipulate the price of BitConnect Coin (BCC) so that it looked to still be successful. At its peak, BitConnect Coin was trading at $463.31.
BitConnect ended up simply paying the earliest investors with money taken from…
