A complaint has been filed by James Gurry, Ronald Nelson, Francisco Doria, Aric Harold, Akiva Katz, and Charles Wildes with the Southern District Court of Florida, and is made on account of all Bitconnect customers, in addition to the plaintiffs as mentioned earlier individually.
The suit has been instituted against all three corporate entities comprising the Bitconnect company, in addition to defendants “Glenn Arcaro, Trevon Brown (Trevon James), Ryan Hildreth, Craig Grant, and Cryptonick” – who are accused of aggressively recruiting new investors into the Ponzi scheme using the power of social media.
The preceding statement of the complaint reports Bitconnect as having raised “millions of dollars’ worth of cryptocurrency” through “a trading platform and lending program fraudulently promoted and managed by” the defendants.
The complaint also states that “Bitconnect guaranteed investors up to a forty percent RIO each month on their investments, following a four-tier investment system based on the sum of the initial deposit.” Investors were “guaranteed a one percent return on investment on a daily basis, which Bitconnect indicated would be generated by its proprietary trading bot and volatility software,” which was to be paid out “regardless of market performance or the fluctuating price of cryptocurrency.” An investment of just one thousand dollars would grow to produce a $50 million revenue within three years of compounding daily interest; the company is reported to have shilled.
The plaintiffs stated that Bitconnect’s former $2.5 billion market capitalization was “built by the use of fraudulent means.” “A wide-reaching Ponzi scheme that defrauded investors made a mockery of state and federal securities laws and employed an army of social media mercenaries who were paid to bring more unsuspecting victims into the fraud.”
Bitconnect’s Lending and Exchange Platform Shuts Down
Bitconnect Faces Lawsuit for Operating “Wide-Reaching Ponzi Scheme” During early January, Bitconnect boasted a market capitalization of more than $2.5 billion. After receiving cease-and-desist notifications from regulators in Texas and North Carolina and an increase in accusations of comprising a Ponzi scam, Bitconnect suddenly announced that it would shut its lending and exchange platform – leaving many Bitconnect token-holders unable to liquidate their assets, the value of which rapidly depreciated by over $95%.
Despite the turmoil, BCC tokens are refusing to die, with many investors seeking to offload their BCC tokens in exchange for BCCX – a token soon to be launched by the company through an initial coin offering. As a consequence, somehow, BCC has a market capitalization of more than $100 million dollars and has witnessed nearly $5.5 million worth of trading during the last 24 hours, according to Coinmarketcap.