CFTC fines South African CEO $3.4B over Bitcoin MLM scheme

CFTC fines South African CEO $3.4B over Bitcoin MLM scheme

Apr. 28, 2023

By Mike Dalton

The case represents the CFTC's highest civil fine and largest Bitcoin fraud case.

The U.S. Commodity Futures Trading Commission (CFTC) said on April 27 that it has obtained a court judgment against a CEO involved in Bitcoin-related fraud.

CEO was involved in Bitcoin MLM

The case in question concerns Cornelius Johannes Steynberg of South Africa, who was the founder and CEO of Mirror Trading International Proprietary Limited (MTI).

Steynberg engaged in an international multi-level marketing (MLM) scheme in which he solicited Bitcoin investment from the public.

Steynberg and his company promised investors the opportunity to participate in a commodity pool. Not only was that commodity pool unregistered, Steynberg and MTI falsely portrayed the pool’s trading activity as bot-operated when in fact they traded off-exchange retail forex. The two pwraties ultimately misappropriated all of their investors’ Bitcoin.

Steynberg began his MLM scheme in May 2018 and solicited funds from more than 23,000 individuals in the U.S. and globally. He obtained nearly 30,000 BTC in total, an amount that was worth $1.7 billion when the scheme concluded in March 2021.