The CEO of South African crypto trading firm Mirror Trading International (MTI) has received an aggravated sentence in Brazil, where he has allegedly been in hiding.
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Johann Steynberg has been found guilty of using a forged identity document, as reported by MyBoadband. Court documents also revealed that he allegedly had two girlfriends under whose names he bought properties.
He was sentenced to three years and six months in prison, although this sentence was commuted to an additional fine to be paid to a court-designated charity. This fine totals R595 000.
In response, his defence team appealed the sentence, saying that he was guilty of a lesser crime with a lighter sentence. According to his legal team, Steynberg’s offence (assuming a false identity) falls under Article 307 of the Brazilian Penal Code. However, he was prosecuted under Article 304 for using forged documents. The state prosecutor also launched their own appeal, arguing that Steynberg should receive a harsher sentence.
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MTI first came into the spotlight in 2020 when the Financial Sector Conduct Authority (FSCA) raided its offices in Stellenbosch and the homes of Steynberg in Polokwane and 50% shareholder Clynton Marks in Durban.
The company promised to grow investors’ Bitcoin with monthly yields of about 10%, and members could reportedly earn bonuses by recruiting more people into the scheme. Steynberg disappeared in December 2020 shortly after investors raised concerns that their withdrawals could not be processed.
As a result of the raid, the scheme collapsed and liquidation applications were lodged against MTI.
Earlier this year in April, an acting judge in the Western Cape High Court, Alma de Wet, ruled that MTI was an unlawful scheme, labelling it a pyramid and a Ponzi-type scheme. Marks has filed for leave to appeal this ruling.
According to MyBroadband, more than 46 000 bitcoin were processed via the scheme which, using a bitcoin price of R565 000, translates into a nearly R26 billion value for the scheme. When the irregularities were revealed, a total of 22 222.548 bitcoin were supposed to be in MTI’s accounts (valued at R12.6 billion) – which makes MTI the largest pyramid or Ponzi scheme in South Africa’s history.
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