Federal Grand Jury in San Diego Indicts BitConnect’s Founder

The US Department of Justice (DOJ) announced today that Satish Kumbhani, the Founder of the $2.4 billion crypto scam BitConnect, has been indicted.

The details shared by the DOJ show that Kumbhani misled investors about the lending program of BitConnect. In partnership with his promoters, Kumbhani marketed his project around the world. In addition, he promoted the BitConnect Trading Bot and Volatility Software as key sources for profitability in the crypto market.

Yesterday, a federal grand jury in San Diego charged Kumbhani and mentioned that the crypto platform acted as a Ponzi scheme. The DOJ added that the Founder of BitConnect abruptly closed the lending program after nearly 1 year.

“Crime, particularly crime involving digital currencies, continues to transcend international boundaries,” said the Assistant Attorney General, Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “The department is committed to protecting victims, preserving market integrity and strengthening its global partnerships to hold accountable criminals engaging in crypto fraud. We thank our partners around the world for their continued efforts.”

Fraudulent Crypto Activities

Illegal crypto transactions, including scams, Ponzi projects and theft have been on the increase for the last 2 years. In February 2021, the authorities in the US charged an Australian man for a $90 million crypto hedge fund scam. Moreover, cryptocurrency scams are surging in Nigeria. To counter the issues, law enforcement agencies around the world have increased their efforts.

“As cryptocurrency gains popularity and attracts investors worldwide, alleged fraudsters like Kumbhani are utilizing increasingly complex schemes to defraud investors, oftentimes stealing millions of dollars,” said Special Agent in Charge Ryan L. Korner of the IRS Criminal Investigation’s (IRS-CI) Los Angeles Field Office. “However, make no mistake, our agency will continue our long tradition of following the money, whether physical or digital, to expose criminal schemes and hold the fraudsters accountable for their illegal acts of trickery and deceit.”