The Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Cornelius Johannes Steynberg’s company Mirror Trading International Proprietary Limited (MTI). The South African company has been charged with fraud and registration violations.
CFTI alleged that Steynberg operated a fraudulent scheme to solicit, accept and pool more than $1.7 billion to trade off-exchange, and retail foreign currency on a heightened margined or financial basis. Steynberg is alleged of engaging in an international fraudulent multilevel marketing (MLM) scheme that brought in 29,421 BTC – worth over $1.7 billion. CFTC claims MTI ran the scheme for nearly three years from May 18, 2018, to March 30, 2021. The agency is seeking full restitution to investors but emphasized that it may not result in the recovery of money lost.
Kristin Johnson, CFTC Commissioner, in a press statement highlighted that the little trading that the defendants did was unprofitable. They misappropriated all of the at least 29,421 Bitcoin accepted from the participants. Johnson emphasized that fraudsters often take full advantage of new technology, global connectivity, and perceived lack of a cop on the beat to perpetrate their scams.
The latest action by CFTC comes nearly a month after it announced that it was adding resources to monitor the crypto market. The agency filed a complaint against Gemini Trust Company LLC, earlier this month, for allegedly misleading regulators in 2017. The CFTC said Gemini made material false or misleading statements to gain approval for its Bitcoin futures product.
The watchdog’s action against MTI comes alongside the US Department of Justice’s charge announcement in four NFT rug-pull cases which could have cost victims millions of dollars.