A California judge has ordered $17 million in restitution to be paid out to hundreds of victims of BitConnect
Following a recent decision in a California court, victims of the infamous BitConnect Ponzi fraud may finally receive compensation.
BitConnect Victims May Get Some of Their Money Back
Around 800 victims of the fraud would receive $17 million in reparations, the US District Court for the Southern District of California ruled. Through its own “BitConnect Trading Bot” and “Volatility Software,” the bitcoin lending platform BitConnect guaranteed investors’ returns.
The forum ran from 2016 to 2018, and at its height, it was worth more than $2 billion on the market. It was later discovered to be a Ponzi scheme, where profits were distributed among earlier investors using capital from new ones. After a recent decision in a California court, victims of the infamous BitConnect Ponzi fraud may finally receive some compensation.
Around 800 scam victims will receive $17 million in reparations, according to the US District Court ruling for the Southern District of California. Through its in-house “BitConnect Trading Bot” and “Volatility Software,” the BitConnect cryptocurrency lending platform guaranteed investors’ returns. The forum ran from 2016 to 2018, and at its height, it had a market value of more than $2 billion. However, it turned out to be a Ponzi scam, where profits were distributed among earlier investors using capital from new ones.
Following a decision in a California court, victims of the infamous BitConnect Ponzi fraud may finally receive compensation. The U.S. Department of Justice declared in November 2021 that it would recoup victims of the scam by selling bitcoin worth $56 million that had been taken from Arcaro.
In February 2022, the DOJ also made public an indictment against Satish Kumbhani, the project’s founder who is still at large, accusing him of acquiring about $2.4 billion from investors through a Ponzi scheme. The government charges Kumbhani with operating an unauthorized money-transferring business, conspiring to commit international money laundering, manipulating commodity prices, and wire fraud.
The court determined that the 800 victims of the scam are entitled to $17 million in restitution in 2020; however, it is not yet known whether the restitution would come from the proceeds of the sale of the confiscated assets or from other sources.
Through its own technology, which includes the “Bitconnect Trading Bot” and “Volatility Software,” BitConnect had advertised itself as a reputable cryptocurrency lending platform, offering investors guaranteed profits. The platform, however, actually ran like a standard Ponzi scam, utilizing money from new investors to pay returns to older investors.
Read more:
- A Judgement Was Obtained Against The Lead Promotor Of BitConnect, After SEC Had Filed A Complaint
- BitConnect Founder Satish Kumbhani With Allegedly Defrauding $2.4 Billion Through The Crypto Ponzi Scheme