An individual from Australia has admitted his role in promoting cryptocurrency lending services linked to the now-defunct BitConnect crypto exchange. BitConnect was notorious for allegedly operating as a Ponzi scheme and ceased operations in 2018 following allegations of defrauding victims out of over $2.4 billion.
John Louis Anthony Bigatton, hailing from Carss Park, New South Wales, recently admitted to a criminal offense tied to his involvement as the national promoter for BitConnect.
He confessed before the Sydney District Court on May 16, 2024, acknowledging his guilt in providing unlicensed financial services on behalf of another individual, a violation under Section 911B(1) of the Corporations Act.
BitConnect operated as a financial services company and an online platform for cryptocurrencies, offering investment opportunities such as the Lending Platform via its website. This platform enticed investors with promises of high interest rates in exchange for their BitConnect coin (BCC) investment over fixed terms.
Notably, investors had limited control over their investments and could withdraw their capital once the lending period concluded.
Mr. Bigatton actively promoted BitConnect and its lending platform through various channels, including social media, seminars across Australia, and face-to-face interactions with potential investors.
Despite lacking the necessary Australian Financial Services license or authorization, he provided financial product advice on the Lending Platform and BCC through seminars and social media posts on six occasions at different locations across the country.
The IRS stated, “In truth, however, BitConnect operated a textbook Ponzi scheme by paying earlier BitConnect investors with money from later investors. Arcaro and others ensured up to 15 percent of the money invested into BitConnect went directly into a slush fund to be used for the benefit of its owner and promoters.”
The sentencing hearing for Mr. Bigatton is scheduled for July 5, 2024. An additional charge related to operating an unregistered managed investment scheme was dropped following his guilty plea.
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