Sydney court convicts Bitconnect promoter John Bigatton for providing unlicensed financial advice

The Sydney District Court has convicted John Bigatton, a prominent promoter of the defunct cryptocurrency exchange platform Bitconnect, for providing unlicensed financial advice.

A Sydney court has convicted John Bigatton, a prominent promoter of the defunct cryptocurrency exchange platform Bitconnect, for providing unlicensed financial advice.

According to the Australian Securities and Investments Commission (ASIC), Bigatton promoted Bitconnect through seminars and on social media from August 2017 to January 2018 without the necessary financial services license.

The conviction now disqualifies him from managing corporations for the next five years.

ASIC deputy chair Sarah Court said that the unlicensed financial advice, “erodes trust in Australia’s financial services industry.”

In 2020, ASIC banned Bigatton from providing financial services for seven years.

Founded in 2016, Bitconnect offered a digital token called BitConnect Coin, which could be exchanged for Bitcoin ( BTC ).

In the seminars, Bigatton touted Bitconnect as being superior to traditional term deposits and predicted that the BitConnect Coin would reach at least $1,000.

However, Bitconnect was later revealed to be a Ponzi scheme, and its founder, Satish Kumbhani, was sued in 2021 by the United States Securities and Exchange Commission (SEC) for fraudulently raising about $2 billion from investors.

The US District Court for the Southern District of California ordered the restitution of $17 million for the fraud victims, but Kumbhani’s whereabouts are still unknown as of 2024.

In a separate move in 2018, ASIC applied to the Federal Court to freeze Bigatton’s assets, including his cryptocurrency holdings, in a new precedent.

This was the first time the Australian regulator obtained freezing orders over digital assets.

According to an ASIC statement on May 17, Bigatton pleaded guilty to his involvement in promoting BitConnect, admitting to providing advice without authorization or the correct license.

ASIC alleged that Bigatton had advised on six occasions at different locations across Australia, stating that he “undertook promotional activities for BitConnect and the Lending Platform.”

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