BitConnect fraud scheme victims being reimbursed with $56M seized crypto
In September, the SEC charged BitConnect founder Satish Kumbhani and its U.S. promoter, Glenn Arcaro, for $2 billion fraud. In a step to compensate for the losses suffered by the biggest crypto fraud scam victims officially charged criminally in the United States, authorities are liquidating $56 million worth of seized assets.
BitConnect victims eligible for compensation
As per approval from U.S. District Judge Todd W. Robinson, around $56 million worth of seized assets will be liquified to compensate for the losses of the victims of the fraud. BitConnect also accepted the ruling by Judge Robinson. The U.S. Department of Justice and the U.S. Attorney's Office for the Southern District of California requested the approval.As per the interlocutory sale order by Judge Robinson, the government will now sell the seized crypto assets from the self-proclaimed 'number one promoter.' The proceeds from the sale will be held in U.S. dollars and distributed between those affected. The rest of the seized digital assets will remain in the government-owned crypto wallet and await restitution to the proper owner as per court orders.
"All potential victims of the BitConnect scheme are encouraged to visit https://www.justice.gov/usao-sdca/us-v-glenn-arcaro-21cr02542-twr for information on rights they may possess as a victim, the opportunity to submit a victim impact statement, and to identify themselves as a potential victim," said the official statement.BitConnect scam is one of the biggest crypto scams that misguided people into investing on the basis of false promises. On Sept. 1, Glenn Arcaro, 44, and Satish Kumbhani were accused of conducting the unregistered and unregulated sale of securities through the BitConnect Lending Program. In between early 2017 to January 2018, the firm was able to get hold of more than 3,25,000 Bitcoins (nearly $2).
The accused fooled people into investing their assets in their Program, lying about the platform's ability to generate 40% profits using a trading bot. But, the reality was that no such bot existed. Arcaro is awaiting his sentence scheduled for Jan. 7, 2022.
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