The Australian Securities and Investment Commission (ASIC) has banned an Australian national from working in the financial sector. According to the watchdog, John Louis Anthony Bigatton operated as the Director of Australia Promotions for the notorious cryptocurrency scam – BitConnect.
Aussie National Banned For BitConnect Participation
As CryptoPotato reported last year, the Australian corporate regulator cracked down on the alleged BitConnect promoter John Bigatton. At the time, the Federal Court froze his accounts and assets and placed him a travel ban, as per ASIC’s request.
According to a recent report, the regulator has taken the situation further by banning Bigatton from operating in any financial services. ASIC claimed that from August 2017 to January 2018, Bigatton served as the Director of Australia Promotions at BitConnect and its investment arm – the BitConnect Lending Platform.
“ASIC alleges that Bigatton provided unlicensed financial product advice and engaged in conduct, which was misleading, deceptive, or was likely to mislead or deceive investors.”
The watchdog also indicated that Bigatton is not a “fit and proper person to provide financial services; is not adequately trained, or is not competent to provide financial services; is likely to contravene a financial service law.”
Bigatton has the right to appeal against the decision with the Administrative Appeals Tribunal.
The BitConnect Fraudulent Story
Launched in 2016, BitConnect offered suspiciously high daily returns for users that traded their bitcoins or other cryptocurrencies for the BitConnect Tokens on its exchange. The profits depended on the number of coins the user had and how many people he has successfully invited to join BitConnect. The latter raised concerns if the project is not another multi-level marketing scheme.
However, the promised 1% daily returns attracted thousands of investors allured by the company’s “revolutionary” algorithm. Without providing details, BitConnect claimed that this algorithm secured profits by buying BTC when its price is low and selling it when Bitcoin pumps.
The BitConnect Token (BCC) price skyrocketed in correspondence with the growing interest of the project. BCC peaked at nearly $500 and reached a total market cap of almost $3 billion.
Nevertheless, authorities were starting to crack down on the project. Shortly after its popularity peak during the parabolic price increase, BitConnect was slapped with an Emergency Cease and Desist Order from the Texas Securities Commissioner. North Carolina followed suit.
As a response, BitConnect closed the exchange, making it impossible for investors to withdraw money from the platform, and BCC crashed in value.
Dozens of victims filed class-action lawsuits, which were later combined into one. However, they may never see their funds again. The BitConnect creators initiated a massive web of different companies registered in various tax havens, making the money trace nearly impossible.