An Australian man has pleaded guilty to being involved in promoting cryptocurrency lending services

An Australian man has pleaded guilty to his involvement in promoting cryptocurrency lending services for the now-defunct cryptocurrency exchange Bitconnect – a notorious entity that allegedly operated as a Ponzi scheme and was shut down in 2018 amid accusations of defrauding victims of more than $2.4 billion. .

“Mr. Bigatton provided advice on financial products without holding an Australian financial services license or authorization to provide financial services around the lending platform,” the Australian Securities and Exchange Commission (ASIC) announced in a statement issued on May 17.

ASIC alleged that in his role as national promoter of BitConnect, John Lewis Anthony Pegaton provided advice on financial products on six occasions in various locations across Australia, at four seminars, and through two social media posts.

“Mr Pegaton undertook promotional activities for BitConnect and the lending platform on social media, at seminars he hosted at various locations across Australia, and through face-to-face meetings with investors.”

BitConnect’s lending platform was promoted as an investment opportunity, encouraging investors to purchase BitConnect Coin (BCC) through its website.

Investors can lend BCC for a specific period in exchange for high interest rates. Once invested, they could not take control of their loans or withdraw their money until the lending period expired. This was allegedly set up this way so the platform could operate as a Ponzi scheme, paying early BitConnect investors money from later investors, according to the IRS.

The sentencing hearing is scheduled for July 5.

Related: Cryptocurrency personality pleads guilty to fraud after promising ‘fake’ 60% returns

Launched in February 2016, BitConnect operated a platform and digital currency, before shutting down in January 2018, with the founders eventually disappearing with investors’ money.

A few years later, in January 2023, the US District Court for the Southern District of California ordered the recovery of $17 million due to the fraudulent scheme.

A group of cryptocurrency fraud victims in the BitConnect investment scheme have seen some relief from the multi-billion dollar fraud scheme after a court ordered them to get a share of a $17 million payout.

The whereabouts of founder Satish Kompany are still unknown.

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