US Authorities Insist On Seizure of BitConnect Promoters’ Property
The authorities of Illinois and Arizona, American states, appealed to the Criminal Investigation Department of India (CID) with a demand to attach property of promoters of BitConnect, a crypto investment company, The Times of India reports.
At the beginning of 2018, BitConnect stopped its work following accusations of organizing a financial pyramid, similar to the Ponzi scheme. The firm's representatives promised a fabulous income from investments in the BitConnect cryptocurrency.
The Indian firm's management is suspected of raising funds worth more than $5.5 billion. The majority of the funds were received from depositors after the demonetization, which was carried out by the government under Prime Minister Narendra Modi in 2016.
The reform of the Indian government was aimed at combating of corruption, and the CID argues that many investors of BitConnect are suspected of money laundering. Criminal investigation officers will carefully check the income sources of those investors with the help of the executive branch and the revenue authority.
Initially, Shailesh Bhatt, an entrepreneur who invested about $275,000 in the BitConnect project, reported on the fraudulent scheme. In late August, the police arrested Divyesh Darji, who was the head of the BitConnect office in Surat. The office staff members admitted that they attracted tens of millions of rupees from thousands of investors.
Since the termination of BitConnect, a number of investors from the United States initiated a lawsuit against the firm, thereby demanding a compensation for the lost funds totaling $771,000.