America’s Commodity Futures Trading Commission has filed a civil enforcement action against a South Africa-based bitcoin pool operator, Mirror Trading International (MTI) for $1.7 billion fraud.
The CFTC charged Cornelius Johannes Steynberg from Stellenbosch, Western Cape for fraud and registration violations with a value of over $1,733,838,372 on Thursday.
They alleged that the pyramid scheme misappropriated all of the bitcoin it accumulated.
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“This action is the largest fraudulent scheme involving Bitcoin charged in any CFTC case. Steynberg created and operated through MTI, a global foreign currency commodity pool that only accepted Bitcoin to purchase a participation in the pool,”
While it continues with the legal suit, the CFTC said it sought full restoration to all defrauded investors, disgorgement of ill-gotten gains, civil monetary penalties, permanent registration and trading bans.
It’s also seeking a permanent injunction against future violations of the Commodity Act and CFTC regulations.
But it warned the victims that the restoration orders may not result in the recovery of the money they lost as Steynberg might not have sufficient funds or assets.
The charges stem from 18 May 2018 to March 2021 when Steynberg engaged in an international fraudulent multi-level marketing scheme.
Through www.mirrortradinginternational.au.za, www.mtimembers.com and www.mymticlub.com, and social media to solicit Bitcoin from people.
“The commodity pool was controlled by MTI and Steynberg and purportedly traded off-exchange, retail foreign currency on a leveraged, margined and/or financed basis, with participants who were not eligible contract participants (ECPs) through what the defendants falsely claimed was a proprietary “bot” or software program,
“During this period, Steynberg, individually, and as the principal and agent of MTI, accepted at least 29,421 Bitcoin—with a value of over $1,733,838,372 at the end of the period.”
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