The US commodities regulators filed civil charges against a South African man and his company for operating a fradulent commodity pool worth over 1.7 billion inBitcoin.
The Commodity Futures Trading Commission CFTC said the fraud scheme, which saw thousands of people solicit virtual currency online, was the largest it had ever pursued involving the coin. The CFTC has filed charges against Mirror Trading International Proprietary Limited and its CEO, Cornelius Johannes Steynberg.
Steynberg had been a fugitive from South African law enforcement but was recently arrested in Brazil on an INTERPOL arrest warrant, the CFTC said. He could not be reached for comment.
In its complaint, the CFTC said that the company claimed to have proprietary software that would make significant trading gains for investors who pooled their bitcoins, but in reality no such bot existed.
The CFTC says that only a small portion of the pooled bitcoin was ever invested, and the rest was misappropriated. South African authorities launched a fraud investigation after the company filed for bankruptcy in 2021.
The CFTC said that approximately 23,000 Americans were invested in the pool.