In a shocking news update, sources have reported that an Indian man has been found associated with kidnapping two individuals who were linked to the scandalous BitConnect Ponzi scheme, which incurred loss of an alleged $2.4 billion to the investors. Shailesh Babulal Bhatt is an investor in the BitConnect Coin,who reportedly led the kidnapping to recover his lost money in the fraud and is alleged to have asked for ransom. This event has gained traction as the Bitconnect scheme was a massive exploit that affected several investors.
Bhatt and the Bitconnect Scheme
Shailesh Babulal Bhatt had reportedly invested in the Coin and as he fell a prey to the BitConnect scheme, he took the justice in his own hands. The Indian Enforcement Directorate (ED) was reported to have stated that Bhatt and multiple other investors were responsible for kidnapping two employees linked to Satish Kumbhani, the founder of BitConnect. Their aim was to get their invested money back through ransom. The whole event shows how the Ponzi scheme had affected the investors deeply and they were desperate to get their money back.
BitConnect Falling from Heights
Bitconnect was introduced in 2016, as reported, and as it hit the market, it was put forward as a high-return investment program. Investors were convinced to buy BitConnect Coins and lend them through the platform. This lending was posed as lucrative to the investors as the platform allegedly promised high returns of up to 1% per day. The platform states that these returns were calculated by the “BitConnect Trading Bot” and specialized “volatility software,” which reportedly got profits from the turbulence experienced by crypto prices.
However, to much of the despair of the investors, this high-yield program turned out tobe a Ponzi scheme just like many others in the crypto arena. Returns paid to earlier investors were not made through true profits but were done with the help of funds from the subsequent investors. The BitConnect scheme gew fast and gained investors from all over the world, making the collective investments of around $2.4 billion before its impending doom.
The downturn of BitConnect was triggered when U.S. state regulators issued cease-and-desist orders, cautioning that the platform was running illegal operations. This led to an instant loss of confidence, and by 2018, the situation turned highly volatile with investor losses.
Ransom Demands and Seized Assets
According to the ED’s statement, Bhatt was successful in taking out a sizeable amount of crypto and cash from the employees he kidnapped. The ransom included 2,091 Bitcoin (BTC), 11,000 Litecoin (LTC), and around $1.7 million in Indian rupees, news sources report. The total value of the assets acquired was reported to be around $146.8 million.
Deeper investigation by the authorities stated that Bhatt’s accomplices had received $34 million from the ransom. They used these funds to purchase “immovable properties, gold, and other assets.” The ED has since frozen $52 million worth of movable and immovable properties” that were associated with the BitConnect scheme.
Legal Repercussions for Bhatt
Bhatt was reported to be apprehended on August 13 under India’s Prevention of Money-Laundering Act after showing up in court in Ahmedabad. The investigation into Bhatt’s actions began after two First Information Reports (FIRs) were filed with the State Crime Investigation Department in 2022. Bhatt had been first arrested after the kidnapping incident in 2017.
Where is BitConnect’s Founder?
BitConnect’s founder, Satish Kumbhani, is still a mystery, while the global authorities are on a constant lookout for him.
However, many other promoters of the Bitconnect scheme have been charged. One famous name is John Louis Anthony Bigatton, who was convicted by the Australian Securities & Investments Commission in July 2024. Bigatton was found guilty of providing unlicensed financial advice related to BitConnect, as reported.
Takeaway
Bhatt’s desperate act to recover his lost money in the BitConnect scheme is not a new feat in the crypto world. Authorities in Malaysia recently revealed a similar case of crypto-related kidnapping. In this incident, 14 individuals were reportedly arrested for kidnapping a Chinese national and a Malaysian woman. The kidnappers asked for and received $1.2 million in cryptocurrency as ransom. These cases showcase the dark side of cryptocurrency if things go south. Learn more about such developments with DeyThere.
