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BitConnect’s Victims to Receive $17M in Restitution Seized From Scam’s Promoter
The money will be distributed to approximately 800 victims from over 40 different countries.
Updated Jan 13, 2023, 5:08 p.m. Published Jan 13, 2023, 4:43 p.m.
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A California judge has ordered $17 million in restitution to be paid out to hundreds of victims of the BitConnect Ponzi scheme, the infamous global scam that collapsed in 2018.
U.S. District Court Judge Todd Robinson in San Diego, California, issued the order on Thursday. The money will come from the $56 million forfeited by one of BitConnect’s top promoters, Glenn Arcaro.
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Arcaro pleaded guilty to one count of conspiracy to commit wire fraud in September 2021. One year later, in September 2022, Arcaro was convicted and sentenced to 38 months in prison for his role in the scheme. Arcaro held a position near the top of BitConnect’s pyramid scheme of promoters, and earned 15% of every investment in BitConnect’s “Lending Program” – which defrauded thousands of investors around the world of an estimated $2.4 billion.
Arcaro is not the only BitConnect bigwig to face consequences for his role in the scheme: BitConnect’s founder, Satish Kumbhani, has been indicted on a host of felony charges, including conspiracy to commit wire fraud, wire fraud, conspiracy to commit price manipulation, operating an unlicensed money transmitter and conspiracy to launder funds internationally. Kumbhani was also sued separately by the U.S. Securities and Exchange Commission (SEC) in September 2021.
However, bringing the BitConnect founder to justice has proved to be a difficult task. Kumbhani, an Indian citizen, disappeared last February after being indicted. Indian authorities confirmed in a legal filing last March that Kumbhani had vanished from India and was assumed to have relocated to another, unknown country.
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