• 800 victims of the BitConnect Ponzi scheme will receive $17 million in restitution from the U.S. Department of Justice.
• The funds will be distributed to individuals from 40 countries.
• BitConnect was in operation from 2016 to 2018 and its associates have been charged and found guilty for various allegations.
BitConnect, a Ponzi scheme that operated from 2016 to 2018, has recently been ordered by the U.S. Department of Justice (DOJ) to deliver $17 million in restitution money to 800 victims located in 40 countries around the world.
BitConnect was widely recognized by both the public and legal proceedings as a Ponzi scheme. The project’s founder, Satish Kumbhani, was indicted in February of 2022, while lead U.S. promoter, Glenn Arcaro, pled guilty in September of 2021. Additionally, both were sued by the U.S. Securities and Exchange Commission in September 2021.
BitConnect’s associated crypto token, which held substantial value prior to the project’s shutdown, quickly collapsed after the project ceased operations. Various jurisdictions, including the U.K., Texas, and North Carolina, took action to restrict BitConnect’s operations at an early date, but due to its distributed structure and lack of central leadership, some aspects of the project continued even after its shutdown.
The DOJ seized $56 million of cryptocurrency with the intention of selling it and providing restitution to victims in November 2021. This $17 million restitution is part of the $56 million, and is the largest payout to victims of the Ponzi scheme to date.
The long wait for compensation for the victims of BitConnect is finally coming to an end. While the $17 million is a small fraction of the estimated $2.5 billion that BitConnect swindled from its investors, it is a significant step in the right direction for those affected.