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The main US derivatives regulator is the latest authority to seek penalties from a Bitcoin trader that’s been accused by South African officials of operating a massive crypto Ponzi scheme. Picture: BLOOMBERG
The main US derivatives regulator is the latest authority to seek penalties from a Bitcoin trader that’s been accused by South African officials of operating a massive crypto Ponzi scheme. Picture: BLOOMBERG

The main US derivatives regulator is the latest authority to seek penalties from a bitcoin trader that’s been accused by South African officials of operating a huge crypto Ponzi scheme. 

The Commodity Futures Trading Commission said on Thursday that Mirror Trading International and its leader Cornelius Johannes Steynberg between March 2018 and 2021 bilked at least 23,000 Americans out of bitcoin investments that were worth $1.7bn (R28bn) at the time. Neither Steynberg nor Mirror could immediately be reached for comment.

Mirror Trading operated as “an international fraudulent multilevel marketing scheme” that collected money from people to invest in an unregistered commodity pool, the CFTC said in complaint filing in federal court in Texas. 

The CFTC, which is seeking restitution for investors and a range of penalties, is the latest government agency to take legal action against Mirror Trading and Steynberg. According to the regulator, Steynberg is a fugitive from South African law enforcement and was detained in Brazil. 

According to the CFTC, Steynberg told participants and prospective investors that the company had an artificial intelligence bot and a team to trade and earn high profits for the pool’s account. But the company misappropriated almost 29,000-plus bitcoin it received from participants, according to the CFTC. In fact, the agency’s complaint says the firm deposited just over 1,800 bitcoin for trading and lost about a third of them. There also was no bot, the regulator said.  

More stories like this are available on bloomberg.com

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