The SEC Files a Lawsuit against Five People Linked to BitConnect

By José Oramas May 31, 2021 In Crypto News, Scams

The Securities and Exchange Commission has filed a lawsuit against five individuals linked to BitConnect for promoting and selling unregistered securities.

$2B in Unregistered Sales

According to the filing, the SEC stated that BitConnect’s lending program constituted a $2 billion USD unregistered securities offering ever since the platform was not operating with a broker-dealer license.

Four BitConnect promoters —Trevon Brown, Craig Grant, Ryan Maasen and Michael Noble— plus Joshua Jeppesen are now facing disgorgement (repayment of ill-gotten gains) plus interest, injunctive relief and civil penalties. In particular, Jeppesen served as a liaison between BitConnect and its promoters and represented the company at promotional events and conferences.

We allege that these defendants unlawfully sold unregistered digital asset securities by actively promoting the BitConnect lending program to retail investors. We will seek to hold accountable those who illegally profit by capitalizing on the public’s interest in digital assets.

Lara Shalov Mehraban, Associate Regional Director of SEC’s New York Regional Office

As reported, the Australian Securities and Investments Commission accused John Bigatton, a former BitConnect promoter, of ripping off small investors in Australia, back in 2017/2018. Despite the various counts of financial crime, Bigatton pleaded not guilty at Downing Centre Local Court.

Biggest Scam in Crypto History?

Carlos Matos, leader of BitConnect, during an event

BitConnect has been considered one of the largest scams in crypto history. The platform debuted in 2016 with great success but shut its lending platform in 2018 following allegations of fraud and warnings from regulators.

The scam has also been compared to OneCoin, a Ponzi scheme promoted as a cryptocurrency, which had connections with Phoenix Holding Group Ltd — a Dubai-based company recently accused of money laundering through horse racing in Australia.

José Oramas

José Oramas

José is a journalist and translator with a keen interest in blockchain and cryptocurrencies.

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