CFTC charges South African trader with fraud, registration violations

The Commodity Futures Trading Commission CFTC charged Cornelius Johannes Steynberg and his company Mirror Trading International MTI with fraud and registration violations.

The South African trading company was accused of using MTI to operate a global foreign currency commodity pool worth over $1.7 billion, according to a complaint filed by the CFTC on June 30, 2022.

To take part in the pool, users had to purchaseBitcoin, with no other currencies being accepted for participation in the pool. The complaint alleges that this project is the largest fraudulent scheme involving Bitcoin BTC in a CFTC case.

The complaint outlines the fraudulent activity that occurred between May 18, 2018 and March 30, 2021, when Steynberg operated Mirror Trading International as a multi-level marketing scheme. Steynberg used social media and multiple websites to solicit Bitcoin from public members through the global foreign currency commodity pool.

The defendants claimed that the trading was done via a proprietary trading bot or software program, which is alleged to have traded off-exchange, retail foreign currency on a leveraged basis with users who were not eligible contract participants.

During this period, Steynberg accepted 29,421Bitcoin worth $1.7 billion to participate in the commodity pool from approximately 23,000 non-ECPs in the United States and even more in other parts of the world. Even though the defendant was not registered as a commodity pool operator, this was carried out.

Steynberg is alleged to have done this both individually and on behalf of Mirror Trading International. The defendants took all of the Bitcoins that they had taken from the pool members in some way that were improperly appropriated in some way.