The United States Department of Justice (DOJ) said on Friday that a man from Los Angeles had been sentenced to “38 months in prison for his role in Bitconnect.” Bitconnect was defined by the DOJ as “a large fraudulent bitcoin investment scheme.”
According to the filings, Glenn Arcaro, 44, conspired with others to take advantage of investor enthusiasm in bitcoin by falsely presenting Bitconnect’s unique coin offering and digital currency exchange as a successful investment.
Arcaro, according to the DOJ, transferred proceeds from the Bitconnect scam to offshore accounts, converted some of the proceeds into precious metals storage, and obtained foreign passports.
The Justice Department stated that his purpose was to avoid paying federal and state income taxes on his Bitconnect earnings and to protect his assets from IRS collection (IRS).
The Bitconnect Ponzi scheme had a market worth of $3.4 billion at its peak, according to US officials. The creator and his co-conspirators are accused of obtaining $2.4 billion from investors.
The Indian authorities recently initiated an investigation into Bitconnect and arrested its founder, despite the fact that the US had already accused him in February.