The United States Securities and Exchange Commission (SEC) is suing the founder of the cryptocurrency exchange platform BitConnect (now defunct) on charges of fraudulently raising about USD2 billion from thousands of retail investors. The US regulator has accused BitConnect founder Satish Kumbhani, an Indian citizen, of lying about BitConnect’s ability to generate profits and violating investor protection laws.
The SEC also accused promoter Glenn Arcaro and his company Future Money Ltd of fraudulently receiving more than USD24 million in referral commissions and other sums as BitConnect’s leading promoter in the United States. According to the SEC, investors have been told that BitConnect uses a “volatility trading bot” that can generate a return of 40% per month, showing them a fictitious return of 3,700% per year.