(Bloomberg) — The top North American promoter of the BitConnect cryptocurrency investment platform was sentenced to 38 months in prison for running a $2.4 billion Ponzi scheme that defrauded at least 4,500 people from 95 countries.
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Glenn Arcaro, 45, was sentenced Friday in federal court in San Diego, where he pleaded guilty in September 2021. Arcaro admitted he fraudulently marketed BitConnect’s proprietary coin offering and digital currency exchange as a lucrative investment. He touted BitConnect’s phony “Trading Bot” and “Volatility Software” as guaranteed ways to make money on the volatility of cryptocurrency exchange markets.
In reality, BitConnect paid early investors using money received from later investors. BitConnect closed its exchange in January 2018 after getting cease-and-desist letters from state regulators in Texas and North Carolina.
“Fiscal crimes that combine the allure of cryptocurrency with new technology and a savvy marketing strategy are borderless and often begin through a relationship built on trust, hope, and promise,” said FBI Special Agent Gregory Nelsen, who runs the agency’s Cleveland office.
Arcaro, a Los Angeles resident, cooperated with prosecutors, court records show. He agreed to forfeit $24 million.
Bitconnect founder Satish Kumbhani, of Hemal, India, was indicted this year for leading the fraud. But the US Securities and Exchange Commission, which sued him in September 2021, said this year that he…
