A U.S. court has ordered Mirror Trading International Proprietary Limited (MTI) to pay over $1.7 billion in restitution for defrauding investors in a retail foreign currency (forex) scheme. The consent order, entered by Judge David A. Ezra of the U.S. District Court for the Western District of Texas on September 6, also permanently bans MTI from trading in CFTC-regulated markets and from registering with the agency.
The case, originating from a CFTC complaint filed June 30, 2022, centers around allegations that MTI, a company currently in liquidation in South Africa, operated an unregistered commodity pool and engaged in fraudulent practices. This resolves the CFTC’s enforcement case against MTI.
Additionally, the court previously issued a default judgment against Cornelius Johannes Steynberg, the founder and CEO of MTI, on April 24, 2023. Steynberg is required to pay over $1.7 billion in restitution and a $1.7 billion civil monetary penalty – the highest penalty ever ordered in a CFTC case. He is also permanently banned from trading and registration.
According to the CFTC, from May 2018 to March 2021, Steynberg and MTI solicited at least 29,421 Bitcoin – valued at over $1.7 billion – from over 23,000 individuals in the U.S., and thousands more globally, promising profits through a proprietary trading “bot.” The CFTC alleges that the defendants misappropriated all of the Bitcoin received from investors, operating a classic multilevel marketing scam disguised as advanced trading technology.
“The settlement with MTI and default judgment against Steynberg represent the latest stage in our battle against fraudsters who victimized over 23,000 individuals from the U.S.,” stated Ian McGinley, Director of Enforcement. “Here, the fraudsters made the most modern of promises…but were actually committing a classic form of fraud.”
The CFTC cautions that victims may not fully recover their losses due to the potential lack of assets held by the defendants. The agency continues to pursue accountability and protect customers. The CFTC collaborated with the South African Financial Sector Conduct Authority on the investigation.
Source: CFTC.gov
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