Commodity Futures Trading Commission (CFTC) officials have detailed civil enforcement action regarding alleged fraud and registration violations in connection with a Bitcoin transaction.
The CFTC indicated the enforcement action was filed in U.S. District Court for the Western District of Texas, charging Cornelius Johannes Steynberg of Stellenbosch, Western Cape, Republic of South Africa, and Mirror Trading International Proprietary Limited (MTI), a company organized and operated under the laws of the Republic of South Africa.
The CFTC complaint alleges Steynberg created and operated, through MTI, a global foreign currency commodity pool that only accepted Bitcoin to purchase a participation in the pool, with a value of over $1,733,838,372.
The CFTC alleges via the complaint from approximately May 18, 2018, through approximately March 30, 2021, Steynberg, individually and as the controlling person of MTI, engaged in an international fraudulent multilevel marketing scheme, using the websites www.mirrortradinginternational.au.za, www.mtimembers.com, and www.mymticlub.com, in addition to social media, to solicit Bitcoin from members of the public for participation in a commodity pool operated by MTI.
Defendants misappropriated, directly or indirectly, all of the Bitcoin they accepted from the pool participants, the CFTC alleges.
Authorities indicated the CFTC is seeking full restitution to defrauded investors; disgorgement of ill-gotten gains; civil monetary penalties; permanent registration and trading bans; and a permanent injunction against future violations of the Commodity Exchange Act and CFTC Regulations.