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 docket has additionally ordered Steynberg to pay a civil financial penalty of an identical quantity. The Commodity Futures Trading Commission (CFTC) conceded that orders requiring fee of funds “may not result in the recovery of any money lost because wrongdoers may not have sufficient funds or assets.”
‘Largest Fraudulent Scheme Involving Bitcoin’ within the History of the CFTC
A United States Federal Court just lately handed down a default judgment and everlasting injunction towards Johann Steynberg, the CEO of the now-defunct bitcoin ponzi Mirror Trading International (MTI). According to a press release launched 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 financial penalty.
The derivatives regulator’s assertion additionally revealed that the penalty handed down by the court docket “is [the] highest civil monetary penalty ordered in any CFTC case.” The court docket motion itself is reported to be the “largest fraudulent scheme involving Bitcoin charged in any CFTC case.”
As beforehand reported by Bitcoin.com News, Steynberg, who was based mostly in South Africa on the time, had repeatedly confronted allegations of working a bitcoin Ponzi scheme earlier than he fled to Brazil in December 2020. Shortly after his disappearance, liquidation proceedings towards MTI have been instituted by victims based mostly in South Africa.
Almost a 12 months after he disappeared, Steinberg was captured by Brazilian legislation enforcement and is awaiting his extradition to both the U.S. or his native house of South Africa.
Steynberg and MTI Failed to Comply With CPO Regulations
As per the CFTC assertion, the U.S. court docket order outlines Steynberg’s alleged fraudulent actions in addition to his failure to adjust to laws.
“The 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,” reads the CFTC assertion.
Although MTI was primarily working and concentrating on victims based mostly in South Africa, the CFTC assertion claimed that Steynberg and his firm had accepted bitcoin from “some 23,000 individuals in the U.S.” with out being “registered as a CPO as required.” The regulator additionally alleged that Steynberg and MTI had “misappropriated all of the Bitcoin they accepted from pool participants.”
Meanwhile, the CFTC additionally acknowledged within the assertion that the penalty handed down by the court docket might “not result in the recovery of any money lost because wrongdoers may not have sufficient funds or assets.”
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