It has been more than three years since the Securities and Exchange Commission (SEC) has filed its action against BitConnect, an online crypto lending platform, and its founder Satish Kumbhani.

The SEC has been unable to locate Kumbhani, as confirmed by documents submitted by the regulator at the New York Southern District Court on November 15, 2024.

As the Commission has previously advised the Court, the Commission did not know the whereabouts of Kumbhani, an Indian citizen, at the time it filed this action, and BitConnect is an unincorporated entity the Commission must serve through its manager, Kumbhani, pursuant to Rule 4(h)(1)(B) and Rule 4(h)(2).

In the Commission’s most recent status report to the Court, the Commission reported that, notwithstanding its prior efforts to ascertain Kumbhani’s location, including from foreign regulatory authorities, his location remained unknown.

As of November 15, 2024, Kumbhani’s location remains unknown. Kumbhani is also subject to a pending indictment filed by the Department of Justice on February 25, 2022, and the Commission understands he remains in fugitive status in that proceeding.

The Commission has been diligent in attempting to locate Kumbhani, including by seeking the assistance of more than one foreign regulatory authority.

The SEC requests that the Court extend the Commission’s time to serve the Defendants with the Summons and Complaint, from November 20, 2024 to February 18, 2025, so that the Commission may complete its investigation into Defendants’ current whereabouts and, if it locates them within the United States, serve them in a timely fashion.

According to the SEC’s complaint, from early 2017 through January 2018, the defendants conducted a fraudulent and unregistered offering and sale of securities in the form of investments in a “Lending Program” offered by BitConnect. The complaint alleges that, to induce investors to deposit funds into the purported Lending Program, Defendants falsely represented, among other things, that BitConnect would deploy its purportedly proprietary “volatility software trading bot” that, using investors’ deposits, would generate exorbitantly high returns.

However, instead of deploying investor funds for trading with the purported trading bot, defendants BitConnect and Kumbhani siphoned investors’ funds off for their own benefit by transferring those funds to digital wallet addresses controlled by them, their top promoter in the U.S., defendant Glenn Arcaro, and others.

The SEC’s complaint further alleges that BitConnect and Kumbhani established a network of promoters around the world, and rewarded them for their promotional efforts and outreach by paying commissions, a substantial portion of which they concealed from investors.

The SEC’s complaint charges the defendants with violating the antifraud and registration provisions of the federal securities laws. The complaint seeks injunctive relief, disgorgement plus interest, and civil penalties.