Summary: Promoter of Defunct BitConnect Exchange Found Guilty of Providing Unlicensed Financial Advice
John Bigatton, the now-convicted Australian promoter of BitConnect, has been sentenced by the Sydney District Court for offering financial advice without the necessary license. Between August 2017 and January 2018, Bigatton actively promoted BitConnect through seminars and social media, enticing investors with promises of high returns. Despite disclaimers stating that his advice was not financial, the court ruled that Bigatton’s actions indeed constituted as financial advice. This recent conviction adds to Bigatton’s existing ban from providing financial services, highlighting the consequences of unauthorized financial guidance in the crypto industry.
Unauthorized Financial Advice Leads to Conviction
- John Bigatton, the Australian promoter of BitConnect, has been convicted for providing unlicensed financial advice.
- His sentencing includes a three-year recognizance of good behavior and a five-year disqualification from managing corporations.
- Between August 2017 and January 2018, Bigatton actively promoted BitConnect through seminars and social media.
- Despite disclaimers indicating otherwise, Bigatton’s actions were deemed to constitute financial advice by the court.
Promotion of BitConnect with False Promises
- Bigatton marketed the BitConnect Ponzi scheme, requiring investors to acquire BitConnect Coin (BCC) for investment opportunities.
- Investors were promised high returns through investment or loaning BCC for set periods with significant interest rates.
- Once invested, investors had no control over their funds until the lending period ended, as highlighted by the Australian Securities and Investment Commission.
- At a seminar, Bigatton falsely claimed that BCC would appreciate to at least $1,000 within a year, showcasing the deceptive nature of his promotion.
Legal Consequences and Ongoing Proceedings
- ASIC successfully froze Bigatton’s assets, including his crypto holdings, in 2018, marking a significant step in regulating digital assets.
- The ongoing proceedings, now managed by the Australian Federal Police under the Proceeds of Crime Act, are being handled in the Supreme Court of New South Wales.
- Bigatton’s previous ban from providing financial services for seven years, along with his recent conviction, underscores the serious implications of unauthorized financial advice in the crypto sector.
Hot Take: Decisive Action Against Unlicensed Financial Advice
The conviction of John Bigatton serves as a stark reminder of the repercussions of offering financial advice without the necessary authorization. As regulators crack down on unauthorized activities in the crypto space, investors are urged to remain vigilant and cautious when engaging with crypto promoters or investment schemes. This case underscores the importance of transparency, legal compliance, and due diligence in the evolving landscape of digital assets.
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