{"id":20459,"date":"2023-05-02T00:04:51","date_gmt":"2023-05-02T00:04:51","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/us-court-orders-operator-of-south-african-bitcoin-ponzi-scheme-to-pay-over-3-4-billion-regulation-bitcoin-news\/"},"modified":"2023-05-02T00:04:51","modified_gmt":"2023-05-02T00:04:51","slug":"us-court-orders-operator-of-south-african-bitcoin-ponzi-scheme-to-pay-over-3-4-billion-regulation-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/us-court-orders-operator-of-south-african-bitcoin-ponzi-scheme-to-pay-over-3-4-billion-regulation-bitcoin-news\/","title":{"rendered":"US Court Orders Operator of South African Bitcoin Ponzi Scheme to Pay Over $3.4 Billion \u2013 Regulation Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
\n<\/p>\n

\n
\n<\/header>\n
\n\n<\/div>\n

Johann Steynberg, the founder and CEO of Mirror Trading International, has been ordered to pay over $1.73 billion in restitution to victims of his bitcoin ponzi scheme. The court has also ordered Steynberg to pay a civil monetary penalty of a similar amount. The Commodity Futures Trading Commission (CFTC) conceded that orders requiring payment of funds \u201cmay not result in the recovery of any money lost because wrongdoers may not have sufficient funds or assets.\u201d<\/strong><\/p>\n

\u2018Largest Fraudulent Scheme Involving Bitcoin\u2019 in the History of the CFTC<\/h2>\n

A United States Federal Court recently handed down a default judgment and permanent injunction against Johann Steynberg, the CEO of the now-defunct bitcoin ponzi Mirror Trading International (MTI). According to a statement<\/a> released by the U.S. derivatives regulator the Commodity Futures Trading Commission (CFTC) on April 27, Steynberg is required to pay $1,733,838,372 in restitution to defrauded victims and a $1,733,838,372 civil monetary penalty.<\/p>\n

The derivatives regulator\u2019s statement also revealed that the penalty handed down by the court \u201cis [the] highest civil monetary penalty ordered in any CFTC case.\u201d The court action itself is reported to be the \u201clargest fraudulent scheme involving Bitcoin charged in any CFTC case.\u201d<\/p>\n

As previously reported by Bitcoin.com News, Steynberg, who was based in South Africa at the time, had repeatedly<\/a> faced allegations of operating a bitcoin Ponzi scheme before he fled<\/a> to Brazil in December 2020. Shortly after his disappearance, liquidation proceedings against MTI were instituted by victims based in South Africa.<\/p>\n

Almost a year after he disappeared, Steinberg was captured<\/a> by Brazilian law enforcement and is awaiting his extradition<\/a> to either the U.S. or his native home of South Africa.<\/p>\n

Steynberg and MTI Failed to Comply With CPO Regulations<\/h2>\n

As per the CFTC statement, the U.S. court order outlines Steynberg\u2019s alleged fraudulent activities as well as his failure to comply with regulations.<\/p>\n

\u201cThe order finds that Steynberg, the founder and CEO of Mirror Trading International Proprietary Limited (MTI), a company currently in liquidation in the Republic of South Africa, is liable for fraud in connection with retail foreign currency (forex) transactions, fraud by an associated person of a commodity pool operator (CPO), registration violations, and failure to comply with CPO regulations,\u201d reads the CFTC statement.<\/p>\n

Although MTI was primarily operating and targeting victims based in South Africa, the CFTC statement claimed that Steynberg and his company had accepted bitcoin from \u201csome 23,000 individuals in the U.S.\u201d without being \u201cregistered as a CPO as required.\u201d The regulator also alleged that Steynberg and MTI had \u201cmisappropriated all of the Bitcoin they accepted from pool participants.\u201d<\/p>\n

Meanwhile, the CFTC also acknowledged in the statement that the penalty handed down by the court may \u201cnot result in the recovery of any money lost because wrongdoers may not have sufficient funds or assets.\u201d<\/p>\n

Register your email here to get a weekly update on African news sent to your inbox:<\/em><\/p>\n

What are your thoughts on this story? Let us know what you think in the comments section below. <\/strong><\/em><\/p>\n

\n
\n\n<\/div>\n
\n
\nTerence Zimwara <\/h6>\n

\nTerence Zimwara is a Zimbabwe award-winning journalist, author and writer. He has written extensively about the economic troubles of some African countries as well as how digital currencies can provide Africans with an escape route.

\n
\n
\n<\/a>
\n<\/span>
\n
\n
\n
\n<\/a>
\n<\/span>
\n
\n
\n
\n<\/a>
\n<\/span>\n<\/p>\n<\/div>\n<\/div>\n

Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons, JHVEPhoto \/ Shutterstock.com<\/em><\/p>\n

\n

Disclaimer<\/strong>: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com<\/a> does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.<\/p>\n<\/div>\n

\n