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SEC files a lawsuit against five individuals allegedly involved in promoting BitConnect’s “lending program.

The Securities and Exchange Commission (SEC) has obtained a judgment against Glenn Arcaro, the lead promoter of the crypto sc
The Securities and Exchange Commission (SEC) has obtained a judgment against Glenn Arcaro, the lead promoter of the crypto scam BitConnect.

A Securities and Exchange Commission (SEC) civil lawsuit has been filed against five individuals allegedly involved in promoting BitConnect’s “lending program.” BitConnect shut down its main lending platform operations in 2018 after regulatory warnings and allegations of fraud. In a press release issued today on the SEC website, the financial regulator alleges that the individuals contributed to promoting and raising over $2B from retail investors in an unregistered digital asset securities offering.

SEC alleges individuals sold securities without registering as brokers.

The SEC complaint alleges that a network of promoters, four of the five defendants, offered and sold securities as part of the platform’s lending program without being registered broker-dealers without registering the securities with the SEC. This includes a flurry of “testimonial” style videos, the press release states, uploaded to YouTube to justify the merits behind the program. Promoters received commissions based on their success of soliciting funds, the complaint states. SEC in recent times, has tightened its regulations surrounding crypto companies.

Individuals unlawfully promoted the BitConnect lending program to retail investors.

The fifth individual listed in the complaint is accused of “aiding and abetting” the unregistered offering and sales, as a liaison between BitConnect and the promoters, and as a company representative at events and conferences. In the press release statement, New York SEC Associate Regional Director Lara Shalov Mehraban stated, “We allege that these defendants unlawfully sold unregistered digital asset securities by actively promoting the BitConnect lending program to retail investors. We will seek to hold accountable those who illegally profit by capitalizing on the public’s interest in cryptocurrencies.” SEC continues to take a timid approach towards cryptocurrencies as the financial regulator continues to file lawsuits. Earlier, the SEC had filed a lawsuit against Ripple for allegedly selling illegal security, XRP.

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