ASIC vows to combat unlawful promotion of high-risk digital assets
The Sydney District Court has convicted John Bigatton, the Australian promoter of BitConnect, for providing unlicensed financial advice, violating section 911B(1) of the Corporations Act 2001.
BitConnect operated as a financial services business and online crypto platform, requiring investors to acquire BitConnect Coin, a cryptocurrency, to participate in its investment opportunities.
Bigatton, who was released on a recognisance to be of good behaviour for three years, provided unlicensed financial advice while promoting BitConnect in Australia through seminars and social media between August 2017 and January 2018.
“Providing unlicensed financial advice denies Australian investors access to key protections and undermines trust and confidence in Australia’s financial services industry,” ASIC deputy chair Sarah Court (pictured above) stated. “ASIC is committed to taking action against the unlawful promotion of high-risk digital assets to protect Australian investors.
“This matter sends a clear message to Australians – that ASIC has and will act when unlicensed operators try to take advantage of Australian investors.”
John Bigatton, the Australian promoter of financial services business and #crypto platform BitConnect, has been convicted for providing unlicensed financial advice https://t.co/ph6p02lkuo pic.twitter.com/3Qquvrurff
— ASIC Media (@asicmedia) July 15, 2024
During two seminars, Bigatton claimed BitConnect Coins would increase in value to at least US$1,000. In another, he asserted that “BitConnect is better than any term deposit out there.”
ASIC pointed out that many crypto assets are considered financial products under current law and that related services, including seminars and promotions, require an Australian financial services licence.
“The offending involved a breach of trust in that the recipients of the financial product advice were entitled to have an expectation that they were receiving advice from a sufficiently licensed and regulated individual,” Judge Robert Newlinds stated.
“People who get involved in the promotion of financial products as part of a business for profit need to be scrupulous in finding out for themselves what the law is and then to abide by that law. They need to understand that breach of these types of laws is a criminal offence and upon conviction, they can expect to be met with stern penalties.”
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