Indian investor kidnaps BitConnect employees to recover losses

An Indian man allegedly kidnapped two people involved in the $2.4 billion BitConnect Ponzi scheme in order to recoup his losses.

Shailesh Babulal Bhatt was an investor in BitConnect Coin, a token that circulates as the platform’s native cryptocurrency, and according to a statement from the India Enforcement Directorate, Bhatt, along with his accomplices, kidnapped two employees of BitConnect founder Satish Kumbhani to recoup their losses through ransom payments.

Introduced in 2016, the BitConnect Ponzi scheme was disguised as a high-yield investment program where investors were tricked into acquiring BitConnect Coins and lending them out with the promise of earning up to 1% daily. The lending platform was advertised as being powered by a “BitConnect Trading Bot” and “volatility software.”

However, as with any Ponzi scheme, BitConnect operators paid investors returns using funds solicited from newer investors. Over its two-year run, the scheme collected $2.4 billion from victims worldwide, and both the scheme and its token collapsed after U.S. state regulators issued cease-and-desist orders.

According to the ED statement, Bhatt managed to extort Rs 2,091 (BTC), Rs 11,000 (LTC) and around Rs 1.7 million from BitConnect employees, with the total value of the money being around $146.8 million.

Further investigation revealed that the accomplices received $34 million and used the money to acquire “immovable properties, gold and other assets.” ED seized $52 million worth of “movable and immovable properties” in connection with the case.

Bhatt was arrested on August 13 under India’s Prevention of Money Laundering Act after appearing in a court in Ahmedabad. The investigation against Bhatt was initiated following two First Information Reports submitted to the State Crime Investigation Department in 2022. He was first arrested in 2017, a month after the kidnapping.

The whereabouts of BitConnect founder Satish Kumbhani remain unknown, but several key supporters of the scheme have been charged over the years, including John Louis Anthony Bigatton, who was convicted by the Australian Securities and Investments Commission in July 2024 for providing unlicensed financial advice.

Malaysian police have uncovered another similar cryptocurrency ransom case, in which 14 people were arrested for kidnapping a Chinese national and a Malaysian woman and extorting $1.2 million worth of cryptocurrency as ransom.