Bitconnect’s Marketing Representations

February 2019: This case was consolidated with several related cases. (Case No. 18-cv-80086, S. D. Fla.) For more information about the consolidated case, click here.

October 2018: The case was transferred from a court in Minnesota to a court in Florida. (Case No. 18-cv-81329, S.D. Fla.)

January 2018: A class-action lawsuit was filed against Bitconnect for allegedly making deceptive representations and failing to adequately disclose important information about its “online investment scheme” in which investors exchange Bitcoin for Bitconnect coins. The complaint claims that the company misrepresents that it is a “safe way to earn a high rate of return … without … a significant amount of risk,” that there are no days with negative returns, and that it guarantees that investors will earn back their initial investment within a specific period of time without adequately disclosing the investment risks and that there is no guarantee on the money invested if the lending system fails. In addition, the complaint alleges that the company fails to adequately disclose information, including the identities of the principals at the company, the location of the company’s operations and management, and information about how the company has a guaranteed daily return, among other things. Plaintiffs also claim that the company is “both a pyramid scheme and Ponzi scheme” and that it violates Minnesota securities laws. (Mengesha et al v. Bitconnect International PLC et al, Case No. 18-cv-279, D. Minn.)

For more of TINA.org’s coverage of bitcoin, click here.