The Commodity Futures Trading Commission has sued Cornelius Johannes Steynberg & Mirror Trading International Proprietary Limited (MTI) for alleged registration and fraud violations.
According to the accusation, Steynberg is accused of taking part in worldwide multilevel marketing (MLM) fraud scheme that netted 29,421 BTC, or more than $1.7 billion. According to the agency, Steynberg reportedly used his business MTI in the scheme, which ran from May 18, 2018, until March 30, 2021.
The U.S. District Court of Texas received the suit
According to a news statement from the CFTC, Commissioner Kristin Johnson, “As a matter of fact, the little trading that Defendants did was unprofitable, and they misappropriated essentially all of the at least 29,421 bitcoin accepted from participants. The CFTC’s complaint seeks full restitution on behalf of defrauded participants, as well as disgorgement, civil monetary penalties, permanent trading and registration bans, and other relief. Notably, this fraud represents the largest to date charged by the CFTC involving Bitcoin.”
The CFTC announced in May that it was expanding resources to monitor the cryptocurrency sector, and the allegations against Steynberg and MTI are its most recent moves.
Gemini Trust Company LLC, also known as Gemini, was the subject of a complaint from the CFTC earlier this month for allegedly deceiving authorities in 2017. The cryptocurrency exchange allegedly submitted “materially false or misleading claims” to obtain permission for its Bitcoin futures product, according to the CFTC.
The U.S. Department of Justice also announced charges in four NFT “rug-pull” cases that might have cost victims over $100 million on the same day as today’s announced action.
South African national Steynberg was recently apprehended in Brazil under an INTERPOL arrest warrant after eluding South African law enforcement.
What about the recovery of the funds?
The CFTC warns victims that restitution decisions may not lead to the restoration of lost funds, despite the agency’s claim that it is pursuing complete compensation for investors.
“The CFTC cautions victims that restitution orders may not result in the recovery of money lost because the wrongdoers may not have sufficient funds or assets.”