The US Securities and Exchange Commission (SEC) has filed a lawsuit against the offshore company BitConnect, which allegedly organized one of the largest schemes using cryptocurrencies.

The SEC charged the company and its founder Satish Kumbhani with fraud in connection with the misuse of bitcoins received from investors around the world in the amount of $2 billion. The organizer of the scheme, US citizen Glenn Arcaro, pleaded guilty to embezzlement of funds from American investors.

BitConnect sold digital assets in 2016 in exchange for Bitcoin. The company said it has an automated program that will generate cash by trading invested bitcoins. Profits were to be distributed among investors through interest payments.

Meanwhile, according to the SEC, BitConnect did not use the program to trade cryptocurrency. Instead, Kumbhani withdrew part of the bitcoins for personal use and distributed the other part to promoters who helped him raise funds. At the time of the alleged organization of the scheme, Kumbhani was living in India. Regulators do not have information about his current location, according to the SEC complaint, cited by The Wall Street Journal.

The company reimbursed a number of investors using investments from new investors, the SEC filing noted. Many investors lost almost all of their investments, the regulator said. In total, several thousand people invested in BitConnect.

Arcaro created a network of promoters of the BitConnect program in the United States, who advertised it through YouTube videos and received commissions for raising funds for the company. The amount of commissions and other payments received by Arcaro and his company amounted to more than $24 million, the SEC notes.