The Securities and Exchange Commission (SEC) remains unable to locate Satish Kumbhani, the founder of BitConnect. This becomes clear from a status update provided by the SEC to the New York Southern District Court on May 25, 2022.

The document, seen by FX News Group, reveals that Kumbhani might have relocated from India to an unknown address in a different foreign country, and that the Commission had been consulting with that country’s financial regulatory authorities in an attempt to locate Kumbhani’s address, in order to serve both Kumbhani and BitConnect.

At present, although the Commission has submitted a formal request for assistance from the foreign country’s authorities for information as to Kumbhani’s whereabouts, it has yet to receive a substantive response, nor been otherwise able to locate Kumbhani. The Commission also understands that Kumbhani remains at large.

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.