Indicted in the US for cryptocurrency Ponzi scheme, BitConnect founder booked by Pune police

The Pune police have launched a probe into an alleged multi-crore cryptocurrency fraud and have booked Satish Kumbhani, the founder of cryptocurrency investment platform BitConnect, who was recently indicted in a US court on the charges of orchestrating an international Ponzi scheme worth over USD 2.4 billion.

A first information report in the case was registered at the Cyber Police station of Pune City Police on Tuesday night by a Pune-based lawyer who told the police that he lost close to 220 bitcoins – equivalent to over Rs 42 crore as on Wednesday – through multiple cryptocurrency investment platforms. In his FIR, the lawyer has named Kumbhani (36) and six others. Senior Inspector D S Hake from the Cyber Crime Police Station said a probe has been launched into the complaint.

The FIR states that the complainant was defrauded of his original investment of 54 bitcoins and the returns of 166 bitcoins, which he was allegedly made to reinvest into the platforms. The transactions between the complainant and the suspects took place between 2016 and June 2021. No arrests have been made in the case.

According to their preliminary inquiries, police said that Kumbhani, an Indian national and founder of BitConnect, was in February indicted of a 2.4 billion USD cryptocurrency scheme. Kumbhani and his accomplices allegedly misled investors about BitConnect’s schemes. They claimed to have created tech-based applications which could generate large profits on investors’ money in cryptocurrency markets. It is alleged that BitConnect operated as a Ponzi scheme of paying earlier investors with money from new investors. Officials said that the indictment alleges Kumbhani and his accomplices to have siphoned off 2.4 billion USD from their investors.

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