A Los Angeles man pleaded guilty Wednesday to participating in what prosecutors called a “textbook Ponzi scheme” that defrauded more than $ 2 billion of cryptocurrency investors around the world.
SAN DIEGO – A Los Angeles man pleaded guilty Wednesday to participating in what prosecutors called a “textbook Ponzi scheme” that defrauded more than $ 2 billion of cryptocurrency investors around the world.
Prosecutors said Glenn Arcaro, 44, was sitting at the top of the U.S. branch of the BitConnect pyramid investment program, the San Diego Union-Tribune reported.
Arcaro, who pleaded guilty in U.S. district court to conspiracy to commit cable fraud, admitted in his claim agreement that he earned “no less than $ 24 million from the BitConnect fraud conspiracy.” say the newspaper.
As part of his request, Arcaro must return this money to investors. He has up to 20 years in prison when he is sentenced on November 15.
“The BitConnect scheme is believed to be the largest cryptocurrency fraud ever prosecuted,” the U.S. Attorney’s Office said in a statement.
Arcaro’s plea came the same day the U.S. Securities and Exchange Commission filed a civil lawsuit against BitConnect, the Union-Tribune said.
According to prosecutors, Arcaro and his conspirators claimed that BitConnect used proprietary technology that was able to generate huge profits by using investors ’money to operate with the volatility of cryptocurrency exchanges.
“BitConnect actually operated a Ponzi scheme textbook by paying previous BitConnect investors with money from later investors,” prosecutors said.