MTI Founder Ordered to Pay $3.46 Billion in Compensation
Reading Time: 2 minutesThe founder of the South African crypto scam Mirror Trading International has been ordered to pay $3.5 billion in compensation and penalties
The CFTC levied the record charge against Johann Steynberg, who fled to Brazil after taking in billions through MTI
The CFTC noted that the fine was largely symbolic
Johann Steynberg, CEO and founder of Mirror Trading International (MTI), has been told to pay almost $3.5 billion in compensation and penalties to the victims of his Bitcoin Ponzi scheme. The court imposed the record sum two and a half years after MTI was halted and 18 months after Steynberg was arrested in Brazil. However, the Commodity Futures Trading Commission (CFTC) acknowledged that the compensation order may not lead to the recovery of lost funds, as Steynberg might not possess enough money and assets to fulfil his obligations.
Billions in Bitcoin Taken
MTI was a South African Ponzi scheme that guaranteed daily returns of 0.5% using a trading bot, when it was in fact nothing of the sort. The scam accumulated more than 471,000 deposits totaling $589 million worth of bitcoin, with the number of victims thought to be in the hundreds of thousands.
Despite authorities worldwide urging individuals to withdraw their funds, the platform continued to operate until December 2020 when South Africa’s Financial Services Conduct Authority intervened and shut it down. Court records revealed that some ₿30,000 had been submitted to the platform during its lifetime, worth $1.3 billion at the time of the filing, with other victims likely.
CFTC Levies Record Penalty
A group of victims took legal action against MTI, which last May was ordered to pay back $291 million to investors, with separate charges being laid against Steynberg, who at that time had fled to Brazil. He was arrested there in late 2021 and extradited to the U.S. to face charges. The $3.46 billion he has been told to pay represented the highest civil monetary penalty ever ordered by the CFTC, which called MTI the “largest fraudulent scheme involving Bitcoin charged in any CFTC case.”
The penalty is largely symbolic and the CFTC noted that there is almost no chance of getting that much back, but it illustrates the severity of the scam and Steynberg’s role in it.
The post MTI Founder Ordered to Pay $3.46 Billion in Compensation appeared first on FullyCrypto.
Filed under: Bitcoin - @ May 2, 2023 7:27 am