CFTC slaps record $3.4b fine on crypto Ponzi scheme operator

The United States Commodity Futures Trading Commission (CFTC) has ordered Cornelius Johannes Steynberg of Stellenbosch, Western Cape, South Africa, to pay $3.4 billion in restitution and a civil monetary penalty. He organized a crypto Ponzi scheme that defrauded victims in the US and other regions.

In what has been described as the largest civil monetary penalty ordered in any bitcoin (BTC)-related CFTC case since its creation by Congress in 1974, the agency has mandated the organizers of a BTC-based Ponzi scheme to pay over $3 billion. 

According to an April 27 statement by the CFTC, Judge Lee Yeakel of the US District Court for the Western District of Texas has passed an order of default judgment and permanent injunction against Cornelius Johannes Steynberg, a South African fugitive and CEO of the now-defunct Mirror Trading International Proprietary Limited (MTI).

The CFTC order finds that Steynberg and his team organized an international scam multi-level marketing scheme that solicited bitcoin from US residents and public members for participation in the company’s fake crypto trading program.

The CFTC notes that through the fraudulent bitcoin trading program, Steynbrg and MTI received at last 29,421 BTC valued at over $1.7 billion as of March 2021 from 23,000 victims in the US and more from investors across the world. 

Now, the CFTC has ordered Steynberg, currently detained in Brazil on an INTERPOL arrest warrant, to pay $1,733,838,372 in restitution to defrauded victims and a $1,733,838,372 civil monetary penalty.

Steynberg has also been barred from trading in any CFTC-regulated markets, engaging in conduct that violates the Commodity Exchange ACT (CEA), or even registering with the agency in the future.