The United States Securities and Exchange Commission (SEC) has managed to secure default judgments against Glenn Arcaro, the top US promoter of BitConnect, and his affiliated company Future Money.

The relevant orders were signed by Judge John G. Koeltl of the New York Southern District Court on December 3, 2021.

The judgments, seen by FX News Group, resolve the non-monetary relief the Commission seeks in this case against Arcaro and Future Money. In particular, the judgments permanently enjoin Arcaro and Future Money from committing violations of Section 17(a) of the Securities Act of 1933, 15 U.S.C. § 77q(a), and Section 10(b) and 15(a) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and Rule 10b-5 thereunder, 17 C.F.R. § 240.10b-5.

Further, the judgments prohibit Arcaro and Future Money (1) from participating, directly or indirectly, in the issuance, purchase, offer, or sale of any digital asset securities, provided, however, that the proposed judgments would not prevent them from purchasing such securities for their own personal account; and (2) from offering, operating, or participating in any marketing or sales program in which the participant is compensated or promised compensation solely or primarily for (a) inducing another person to become a participant in the program, or (b) if such induced person induces another to become a participant in the program.

The consent judgments, finally, leave open for later resolution, either by motion or further settlement, the issue of monetary relief.

In September 2021, the SEC launched an action against BitConnect, an online crypto lending platform, its founder Satish Kumbhani, and its top U.S. promoter and his affiliated company, alleging that they defrauded retail investors out of $2 billion. The SEC still does not know the whereabouts of Kumbhani.