A class-action lawsuit filed against BitConnect added YouTube as a defendant. The information is according to court documents filed on July 3. Six representatives of Silver Miller firm formerly filed the lawsuit. The Platform which had received numerous ‘bad press’ allegations had announced in January that it would be opting out of the crypto industry. The announcement was as a result of continued desist letters from securities boards in Texas and North Carolina after the platform had been suspected of a Ponzi scheme.
The lawsuit stated the cryptocurrency investment platform issued unregistered securities in the form of crypto tokens and went on to acquire more funds through a wide-ranging Ponzi scheme. The six plaintiffs laid their claim of losing more than $771,000 as personal losses. The plaintiff also stated that the platform used newly invested funds to benefit existing investors putting upcoming investors at a disadvantage.
The Fraudulent YouTube Videos
The July 3 documents state that BitConnect and its affiliated parties posted inappropriate promotional offer videos on YouTube which lured the public to a fraudulent investment scam. YouTube found its way in the wrong side of the law for failing to delist and demonetize the uploaded videos which had the potential to trick users into countless investments risks.70, 000 hours of BitConnect content were posted and managed to attract about 58,000,000 views. The BitConnect affiliates posted the unedited content, and YouTube published it after massively exceeding threshold numbers for eligibility standards.
David Silver, one of the six Silver Miller’s representatives asserted that YouTube remained liable for criminal action after its failure to act, upon learning of fraudulent activity from community users. David said that just knowledge of the foreseeable harm posed against content consumers could render YouTube guilty of court action.
A report by Cointelegraph also claims that the plaintiff blamed YouTube for not conducting appropriate database searches that would help delist BitConnect and its related videos from public access. YouTube is also said to have been accepting numerous unedited content related to the BitConnect scam.
The court documents also referred to recent policy changes to Google LLC concerning a ban towards all cryptocurrency related advertisements and related content due to likely harm they would cause to users of Google platforms. Failing even to warn users of the potential damage of BitConnect videos, YouTube failed as a gatekeeper to protect its audience and therefore the very protocols and proprietary algorithms it set out to handle such scams.