Photo credit: The Mandarin/IGA

John Bigatton, an Australian promoter of the defunct cryptocurrency exchange BitConnect, has been convicted by the Sydney District Court for providing unlicensed financial advice.

Bigatton was sentenced to three years of good behavior and barred from managing corporations for five years, a July 12 document and an announcement on July 15 from the Australian Securities and Investments Commission show.

ASIC said Bigatton, who pleaded guilty in May, promoted Bitconnect, a Ponzi scheme that promised high returns on investments in BitConnect Coin (BCC), through seminars and social media between August 2017 and January 2018. He claimed the investment was superior to traditional term deposits and predicted BCC’s value would soar from $253 to at least $1,000 within a year.

Despite disclaimers stating his advice was not financial, the court determined that the substance of his actions constituted financial advice given without the necessary license. This conviction led to his disqualification from managing corporations.

“Providing unlicensed financial advice denies Australian investors access to key protections and undermines trust and confidence in Australia’s financial services industry,” said ASIC Deputy Chair Sarah Court.

“This matter sends a clear message to Australians - that ASIC has and will act when unlicensed operators try to take advantage of Australian investors.”

This case is part of a broader crackdown on BitConnect. In 2021, the United States Securities and Exchange Commission sued BitConnect’s founder, Satish Kumbhani, for fraudulently raising around $2 billion from investors.

(Source: Seven News)

In 2018, ASIC made a precedent-setting move by freezing Bigatton’s assets, including his crypto holdings, marking the regulator’s first use of such measures involving digital assets. These proceedings are ongoing under the Proceeds of Crime Act.

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