Key Points:
CFTC sentenced the CEO of Bitcoin pool operator Mirror Trading International to pay $3.4 billion in reparations and penalties.
This is the biggest civil monetary penalty ever imposed by the US CFTC in any circumstance.
Steynberg participated in a worldwide fraudulent multilevel marketing scam between 2018 and 2021.
A US court has sentenced a South African CEO to pay more than $3.4 billion in restitution and penalty for a Bitcoin-related fraud scheme. It is the largest civil monetary penalty ever imposed by the US Commodities Futures Trading Commission (CFTC).
A US court has ordered Cornelius Johannes Steynberg, the fugitive Head of the South African crypto scam Mirror Trading International (MTI), to pay penalties and reparations for a Bitcoin fraud scheme.
MTI was a Bitcoin-based network marketing fraud that originated in South Africa and attracted participants from all over the globe.
In September 2020, a group calling itself Anonymous ZA attacked weaknesses in MTI’s poorly-coded website, making news. Chainalysis named MTI the world’s largest cryptocurrency fraud in 2020 after the company fled with over $589 million in bitcoin. South Africa accounted for more than half of the firm’s traffic, along with the United States, United Kingdom, Mexico, and Canada.
According to the report, this is the biggest civil monetary penalty ever imposed by the CFTC in any matter. The CFTC is an independent US government organization that supervises the American derivatives markets, which include futures, swaps, and some types of options.
The government stated in a statement announcing the ruling by US District Judge Laurence Yeakel that Steynberg committed fraud related to retail foreign currency transactions, among other offenses.
“Judge Lee Yeakel of the US District Court for the Western District of Texas entered an order of default judgment and permanent injunction against Cornelius Johannes Steynberg of Stellenbosch, Western Cape, Republic of South Africa,” the report said.
According to the authority, Steynberg participated in a worldwide fraudulent multilevel marketing scheme to obtain Bitcoin from individuals for membership in an unlicensed commodities pool conducted by Mirror Trading between 2018 and 2021.
The CFTC said that MTI’s “controlling person” took 29,421 BTC from 23,000 Americans for conducting an unlawful commodities pool operation, worth at more than $1.7 billion at the time of acceptance.
Although the agency fined Steynberg, it warned that the fine may not result in the recovery of any money lost because wrongdoers may lack sufficient funds or assets.
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