The Investigative Council of jurors has brought charges against the founder of the BitConnect cryptocurrency pyramid, Satish Kumbhani, whose damage is estimated at $2.4 billion.
Kumbhani is charged with conspiracy to commit fraud using electronic means, fraud using electronic means, conspiracy to manipulate commodity prices, conducting an unlicensed money transfer business and conspiracy to launder money internationally.
According to the US Department of Justice, Kumbhani and his accomplices claimed that the company's trading technology allows for significant profits and guarantees income to investors, but in reality payments to earlier participants of the program were made at the expense of new investments. Kumbhani is personally accused of managing the BitConnect network of promoters and evading the requirements of American law. For all sane crimes, he faces up to 70 years in prison. According to the Ministry of Justice, Kumbhani is an Indian citizen and remains at large.
In a separate order, he is being pursued by the U.S. Securities and Exchange Commission (SEC), which filed a civil lawsuit in September. According to the regulator, the BitConnect loan program was an unregistered and fraudulent offer. Some of the BitConnect promoters have already been convicted on the same grounds and sentenced to multimillion-dollar fines. The FBI and the IRS Investigation Department are continuing their own investigations.
"Today's indictment supports the FBI's efforts to identify and prosecute criminals who defraud investors and undermine the ability of full-fledged entrepreneurs to develop in the emerging cryptocurrency space," the FBI said, adding that the international nature of the case will not be a reason to terminate the investigation.