In a note published this Friday (28), the Commodity Futures Trading Commission (CFTC) orders Cornelius Johannes Steynberg to pay a fine of US$3.4 billion (R$17 billion) to the agency and victims of your scheme .
In short, Steynberg is estimated to have collected more than 29,421 bitcoins (R$4.3 billion) from at least 23,000 Americans and thousands of other people around the world, to operate a robot that promised a profit of 10% per month. However, the whole story was a hoax to cover up a multi-level pyramid scheme.
The founder of Mirror Trading International (MTI) was arrested in Brazil in June 2022 after evading authorities for about two years. According to the CFTC, this is the largest fraud case involving Bitcoin, as well as the largest civil fine imposed in a CFTC case.
Promised profit, but used victims’ Bitcoin for their own benefit
The pen of Cornelius Johannes Steynberg is divided into two parts. The intriguer of the pyramid must repay $1.73 billion to the victims and pay the same amount to the CFTC. In total, the amount is US$3.4 billion (R$17 billion), the largest fine ever imposed by the US agency.
In addition to allegations of running a business without proper licensing, for example to attract investment from Americans, the CFTC also alleged that Steynberg used the collected bitcoins to fund his lifestyle.
“Directly or indirectly, the defendants have embezzled all Bitcoin they accepted from participants.”
“Steynberg Was Involved in an International Multi-Level Fraudulent Marketing Plan to Solicit Bitcoin to Participate in an Unregistered Commodity Pool”pointed out to the CFTC. “MTI and Steynberg controlled the commodity pool and reportedly traded forex off-exchange through what they falsely claimed to be a “bot.”
Such a bot (robot, in Portuguese) promised a profit of 10% per month. That is, the operator of the pyramid promised to more than double the victims’ bitcoins every year, an unsustainable undertaking.
Steynberg Prison in Brazil
The founder of Mirror Trading International followed in the footsteps of Charles Ponzi (1882 – 1949), a pyramid scheme that gave rise to the term “Ponzi scheme”. Born in Italy, Ponzi perpetrated scams in the US and Canada, but ended his life miserably in Brazil.
By inspiration, or by chance, South African Cornelius Johannes Steynberg also claimed victims in the US and has been in hiding in Brazil since 2020, blaming Freemasonry for the interruption of looting from his platform.
However, Steynberg was arrested by authorities in 2022 and extradited shortly after. This was the largest Bitcoin fraud case prosecuted by the CFTC and the BRL 17 billion fine is also the largest in the history of the US agency.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
