US Court Orders Operator of South African Bitcoin Ponzi Scheme to Pay Over $3.4 Billion

Johann Steynberg, the laminitis and CEO of Mirror Trading International, has been ordered to wage implicit $1.73 cardinal successful restitution to victims of his bitcoin ponzi scheme. The tribunal has besides ordered Steynberg to wage a civilian monetary punishment of a akin amount. The Commodity Futures Trading Commission (CFTC) conceded that orders requiring outgo of funds “may not effect successful the betterment of immoderate wealth mislaid due to the fact that wrongdoers whitethorn not person capable funds oregon assets.”

‘Largest Fraudulent Scheme Involving Bitcoin’ successful the History of the CFTC

A United States Federal Court precocious handed down a default judgement and imperishable injunction against Johann Steynberg, the CEO of the now-defunct bitcoin ponzi Mirror Trading International (MTI). According to a statement released by the U.S. derivatives regulator the Commodity Futures Trading Commission (CFTC) connected April 27, Steynberg is required to wage $1,733,838,372 successful restitution to defrauded victims and a $1,733,838,372 civilian monetary penalty.

The derivatives regulator’s connection besides revealed that the punishment handed down by the tribunal “is [the] highest civilian monetary punishment ordered successful immoderate CFTC case.” The tribunal enactment itself is reported to beryllium the “largest fraudulent strategy involving Bitcoin charged successful immoderate CFTC case.”

As antecedently reported by Bitcoin.com News, Steynberg, who was based successful South Africa astatine the time, had repeatedly faced allegations of operating a bitcoin Ponzi strategy earlier helium fled to Brazil successful December 2020. Shortly aft his disappearance, liquidation proceedings against MTI were instituted by victims based successful South Africa.

Almost a twelvemonth aft helium disappeared, Steinberg was captured by Brazilian instrumentality enforcement and is awaiting his extradition to either the U.S. oregon his autochthonal location of South Africa.

Steynberg and MTI Failed to Comply With CPO Regulations

As per the CFTC statement, the U.S. tribunal bid outlines Steynberg’s alleged fraudulent activities arsenic good arsenic his nonaccomplishment to comply with regulations.

“The bid finds that Steynberg, the laminitis and CEO of Mirror Trading International Proprietary Limited (MTI), a institution presently successful liquidation successful the Republic of South Africa, is liable for fraud successful transportation with retail overseas currency (forex) transactions, fraud by an associated idiosyncratic of a commodity excavation relation (CPO), registration violations, and nonaccomplishment to comply with CPO regulations,” reads the CFTC statement.

Although MTI was chiefly operating and targeting victims based successful South Africa, the CFTC connection claimed that Steynberg and his institution had accepted bitcoin from “some 23,000 individuals successful the U.S.” without being “registered arsenic a CPO arsenic required.” The regulator besides alleged that Steynberg and MTI had “misappropriated each of the Bitcoin they accepted from excavation participants.”

Meanwhile, the CFTC besides acknowledged successful the connection that the punishment handed down by the tribunal whitethorn “not effect successful the betterment of immoderate wealth mislaid due to the fact that wrongdoers whitethorn not person capable funds oregon assets.”

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