South African financial regulator, the Financial Sector Conduct Authority (FSCA), has filed criminal charges with local law enforcement officials against Mirror Trading International (MTI), the alleged online bitcoin trade. The regulator says his decision to file a complaint follows an investigation into MTI that exposed the use of false trading statements, unreported losses and potential fraud involving thousands of bitcoins.
False Trading Statements
The preliminary findings of the ongoing investigation seem to contradict the claims of MTI executives that their company’s trading bot “has achieved an average return of 10% per month and that MTI has never had a negative profit trading day, with one exception. after”. The findings also seem to contradict previous denials by MTI CEO Johann Steynberg, who was slapped with a stop and stop orders from US regulators that his organization is conducting a scam operation.
According to an statement issued Dec. 17, the FSCA accuses MTI’s executives repeatedly of using “trading statements based on demo trading accounts and not actual trades.” The practice, ostensibly intended to reassure investors about MTI’s profitability, was discovered by FX Choice, a Belize-registered online trading platform.
Such as reported news.Bitcoin.com blocked FX Choice MTI accounts after discovering the latter was running a multi-level marketing scam. Meanwhile, as part of its investigation, the FSCA says it has contacted and obtained evidence from FX Choice showing that MTI was actively involved in an attempt to mislead its investors.
After the relationship with FX Choice ended, MTI started working with another online trading platform, Trade 300. Interestingly, the FSCA says it found evidence on a desktop that was seized during a raid about the residence of an MTI manager who suggests that Steynberg controls Trade 300.
The missing Bitcoins
In the meantime, the FSCA suggests that the freezing of MTI’s account with FX Choice opened a can of worms. According to the regulator, studies show that “the total (number) of crypto assets frozen on FX Choice is a negligible amount” compared to “total assets that MTI claimed to have invested on behalf of its clients”. The FSCA explains this inconsistency as follows:
FX Choice confirmed that from January 29, 2020 to June 3, 2020, MTI deposited 1,846.72 bitcoin and suffered a loss of 566.68 bitcoin, an estimated capital loss of 30%.
But when it had its fallout with FX Choice, MTI claimed it “transferred 16,444 bitcoin from FX Choice to Trade 300 in 4 installments on July 21, 2020; July 22, 2020 and July 24, 2020. ”
Meanwhile, after conducting its own investigation, the FSCA says it has found no evidence to support MTI’s claim that it has BTC. The regulator explains:
The FSCA found that there was no withdrawal of bitcoin by MTI from FX Choice in July 2020. The last withdrawal of bitcoin by MTI from FX Choice took place in August 2019. Furthermore, FX Choice confirmed that none of the eight sending wallets are related to FX Choice and that FX Choice had not received any deposits from or any payments to any of the eight bitcoins. wallets. “
Perhaps in a sign that the MTI is starting to unravel bitcoin scams, the regulator reveals that it has “received complaints that investors were unable to pay back their investments.” On social media, which Steynberg and his associates used extensively to refute allegations of scams, concerned investors complain about “delayed” withdrawals.
What do you think about the findings of the FSCA probe? Tell us what you think in the comments section below.
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