Satish Kumbhani, the creator of the cryptocurrency investment platform BitConnect, has been arrested as a result of a multi-million dollar cryptocurrency “fraud” investigation started by Pune Police.
Kumbhani is currently under investigation by the Federal Bureau of Investigation after previously been charged in a US court with running a global Ponzi scheme for US$2.4 billion (FBI).
A Pune-based attorney filed a FIR at the Cyber police station on Tuesday, telling the authorities that he lost over 220 bitcoins—worth more than Rs 42 crore as of Wednesday—through cryptocurrency investing platforms. Kumbhani (36) and six other people have been named by the attorney.
According to the FIR, the complainant’s initial investment of 54 bitcoins and refunds of 166 bitcoins were stolen. The deals were made between June of 2016 and June of 2021. A search for the accused has been started, but no arrests have yet been made. According to officials, they will also look into whether the same group of suspects has defrauded more victims.
According to early investigations, Kumbhani, an Indian national and the founder of BitConnect, was charged in February with running a $2.4 billion bitcoin fraud, according to the police.
The case has been lodged, according to Senior Inspector D S Hake of the cybercrime police station, and an investigation has begun.
According to a news release from the US Department of Justice on February 25 regarding Kumbhani’s indictment, “A federal grand jury in San Diego issued an indictment today accusing the creator of BitConnect with organising a global Ponzi scheme. BitConnect, a purportedly fraudulent bitcoin investment platform, peaked at $3.4 billion in market value.
The founder of BitConnect, Satish Kumbhani, allegedly misled investors regarding BitConnect’s ‘Lending Program,’ according to court records. By leveraging investors’ money to trade on the volatile cryptocurrency exchange markets, Kumbhani and his accomplices claimed that BitConnect’s alleged patented technology, also known as the “BitConnect Trading Bot” and “Volatility Software,” could yield substantial profits and guaranteed returns. But according to the indictment, BitConnect operated as a Ponzi scheme.
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