MTI

South African Court Submissions Expose Lies and Deceptive Tactics Used to Perpetuate MTI Bitcoin Ponzi Scheme

10/06/2021 by Idelto Editor

New submissions by a South African regulator, the Financial Sector Conduct Authority (FSCA) and liquidators have exposed the web of lies and deceptive tactics that were used by Mirror Trading International (MTI) CEO Johann Steynberg and others to perpetuate the Ponzi scheme.

Undeclared Losses

In its report filed with the South African court, the regulator also exposes the true extent of losses that were incurred by the bitcoin investment company. For instance, in what the FSCA calls the “first period,” MTI had a “total of nearly 51 bitcoin (that) were deposited with Belize-based forex broker FXChoice, but 22 — or 43% — of these coins were lost by the traders.” However, at this point there was “no multi-level marketing involved.”

Nevertheless, this would change in the second period “when Steynberg purportedly introduced a computerized trading bot” that falsely guaranteed returns of 10% each day. The report explained:

FX Choice reported to the FSCA that 1,846 bitcoin were deposited with it between January and June 2020, but of this 566 bitcoin (about 30%) were lost. These trading results were completely at odds with the wild claims of success being promoted on social media by MTI. FX Choice subsequently froze the remaining 1,280 bitcoin.

In the last period, Steynberg claimed all investors’ bitcoin had been transferred to a new broker, Trade 300. Still, when the FSCA investigated this claim, “it concluded that Trade 300 was a fraudulent creation of Steynberg’s and does not exist as a bona fide brokerage,” according to a report by Moneyweb.

MTI Shareholding Structure

Meanwhile, MTI liquidators have similarly submitted “evidence” that exposes the bitcoin investment company’s actual shareholding structure. The liquidators’ position is paraphrased by the Moneyweb report: “Based on the evidence provided by the liquidators, MTI was owned 50-50 by Steynberg and Clynton Marks, who would divvy up 10% of the profits between them every Monday.”

However, the liquidators still concede that Steynberg seems to have been the only individual in MTI dealing with a broker in Belize and an India-based server team. “He would supply trading results from the broker to the server team for capture into the back-office system,” the report notes.

Nepotism Allegations

In the meantime, another director of MTI, Cheri Marks, is facing accusations of using her position in the organization to reward her associates. For instance, Marks is accused of appointing Monica Coetzee to the position of marketing director despite her lack of required qualifications. In addition, Marks is accused of bumping Coetzee’s salary from just over $1000 per month to one BTC per month.

Following these proceedings, a Western Cape High Court is now expected to hear arguments by those that want a final liquidation to be granted and those against it. According to a report, these proceedings are scheduled to be heard in the third week of June 2021.

What are your thoughts on the latest revelations about MTI’s huge losses and its shareholding structure? Tell us what you think in the comments section below.

Sale of MTI Bitcoins in South Africa Briefly Wipes out Premium Buyers

21/04/2021 by Idelto Editor

The premium or arbitrage gap on bitcoin in South Africa recently turned negative following the offloading of coins worth over $75 million by liquidators of MTI. As a result of the temporary supply glut, buying bitcoins on local South African exchanges briefly became cheaper than buying on overseas exchanges.

The Impact of the MTI Liquidators’ BTC Sales

However, following the conclusion of the liquidators’ sale nearly two weeks ago, the arbitrage gap has now turned positive. As one South African media report notes, the premium of BTC has now recovered and was hovering between 4.8% and 6.5% on April 20.

Meanwhile, the same report also quotes, Jon Ovadia, the CEO of a crypto start-up Ovex, explaining why BTC is usually sold at a premium in South Africa. He said:

What we have seen is that crypto arbitrage gaps appear in those countries that have foreign exchange controls, such as South Africa. This of course impacts the demand for hard currency assets, such as bitcoin.

The CEO also discusses the principal factors that determine the size or the extent of fluctuations in the arbitrage gap. For instance, Ovadia states that when the bitcoin price in US dollars falls, “the arbitrage gap tends to rise as there is a lag in the South African rand price of bitcoin.” The other key factors influencing the size of the gap include the massive money printing by central banks as well as the BTC’s bull run.

Bitcoin Premium and Exchange Controls

In the meantime, Ovadia’s assertion that BTC is largely sold at a premium in countries that have stringent exchange controls appears to be validated by the top crypto’s price range in certain countries.

For instance, Bitcoin.com News reported in February 2021 that the premium on BTC surged to more than 40% in Nigeria after the country’s central bank imposed restrictions on crypto trading. Nigeria, just like many of its peers across the African continent, has faced shortages in foreign exchange since the start of Covid-19 lockdowns. Consequently, the country has since introduced tough regulations that seek to conserve this scarce resource.

Similarly, Bitcoin.com News reported in early April that BTC was trading at a premium of 18% in South Korea. Just like South Africa, the Asian economic powerhouse has stringent exchange controls in place and this might explain the huge premium on BTC.

What else do you think causes BTC to trade at a premium? Tell us what you think in the comments section below.

Court Summons Mirror Trading International Executives Over BTC Global Scam Allegations

18/04/2021 by Idelto Editor

Two executives of Mirror Trading International (MTI) have been summoned by a high court in connection with another cryptocurrency investment scam called BTC Global. The court summons followed a civil lawsuit filed by 18 plaintiffs demanding compensation from them.

Two MTI Executives Linked to BTC Global Scam

A High Court summons was issued to Clynton Marks, Cheri Marks, and Andrew Caw in connection to a bitcoin investment scam called BTC Global, South African news outlet Mybroadband reported last week, noting that it has seen the court document.

The court summons followed a civil lawsuit filed by 18 plaintiffs demanding compensation of R2.5 million (approximately $174,662) plus 7% annual interest for the losses they have suffered from the BTC Global scam. In addition, they asked the court for “further and alternative relief” and the legal costs they have incurred as part of the lawsuit.

The court document explains that between September 2017 and March 2018, the defendants “conducted business under the names and style of BTC Global or BTC.” This scam claimed to allow clients to invest in a trading pool managed by a “master trader” called Steven Twain.

According to the publication, there is no evidence that Twain ever existed. In addition, when investors could not withdraw their funds from the scheme, they were informed that Twain was attacked in his home and his equipment was stolen.

Twain disappeared in early 2018; some say his disappearance led to the collapse of BTC Global. More than 27,000 people were reportedly scammed by this bitcoin investment scheme, including investors in South Africa, the U.S., and Australia.

Clynton Marks and Cheri Marks are also involved in a larger bitcoin investment scam, Mirror Trading International (MTI). In its latest crypto crime report, the blockchain data analytics firm Chainalysis named MTI the biggest cryptocurrency scam of 2020.

The news outlet explained that Clynton is a 50% shareholder in MTI while Cheri was the scheme’s head of communications. It noted that MTI and BTC Global share “striking similarities,” adding that they both promised too-good-to-be-true returns on investment and used a multilevel marketing scheme to recruit new members.

The publication also claimed to have seen a legal notice signed by Selzer Law attorneys showing that Caw and the Marks intend to defend against the BTC Global allegations.

Caw previously told Mybroadband that he was only an investor in BTC Global and lost a significant sum when it collapsed. “I was, however, neither a founder nor leader in BTC Global, although I was later accused of being both,” he claimed, asserting that he was not involved in MTI but did offer a proposal early on that would enable MTI to deliver cryptographic proof of its bitcoin holdings.

Cheri Marks has denied owning or being in control of BTC Global. She has also denied using the scheme to steal investor funds, setting up fake profiles for Steven Twain, or knowingly promoting anything illegal. In a statement delivered by her lawyer, Marks said, “Steven Twain is a real person and his disappearance was a shock.” The statement adds that “It is denied that Cheri was/is Steven Twain.”

What do you think about the two crypto scams? Let us know in the comments section below.

South African Regulator Raids Home of Key Members of an Alleged Crypto Ponzi Scheme

27/10/2020 by Idelto Editor

A South African regulator along with the country’s police have reportedly seized electronics devices and computers belonging to two principal members of Mirror Trading International (MTI), an alleged bitcoin Ponzi scheme. The raid at Clynton and Cheri Marks’ home on October 26 was conducted by Financial Sector Conduct Authority (FSCA) officials who are looking for proof of trades and bitcoin balances.

MTI Remains Defiant

The raid comes after the South African regulator previously advised MTI clients to withdraw funds after determining that the company did not have the required operating license.

However, according to a report by Global Crypto that cites a Telegram message sent to MTI members, the defiant sender says “it will be business as usual” while the investment company’s lawyers “are onto this.” The sender adds:

The news (media) will sensationalize this so I would like to pre-warn everyone. MTI will be releasing a video later today or tomorrow. More attacks will happen. This is just to let you know MTI is not going anywhere.

Similarly, a voice message attributed to Cheri Marks confirms the raid by FSCA officers who were reportedly accompanied by 15 South Police Service officers. Still, Marks asserts that the raid “changes nothing” and that scheduled customer withdrawals will continue.

The MTI team has repeatedly denied allegations against their company and they blame the media of trying to destroy a business that is “working to improve the lives.” Yet, despite the denials, international and domestic organizations are adamant that MTI is operating outside and that it is possibly a Ponzi scheme.

Another Ponzi Allegation

Just recently, one South African website that tracks complex Ponzi schemes as well as individuals running them, added MTI to its list of well-known scams. In its assessment, dishonest.co.za flags for MTI making claims that it has had “only one negative trading day since its launch.”

Panning the unrealistic claim, the website says “anyone with basic trading experience knows that it is extremely difficult to avoid losses; almost impossible.” Similarly, the MTI claims that it takes 10% of the day’s trading profits are also flagged.

Meanwhile, on one South African discussion forum, members discuss the MTI’s continuing troubles with regulators and how the MTI is trying in vain to dismiss the litany of allegations. One member of the forum points to how Cheri Marks’ repeated assurance that “everything is fine” has been used by other scammers in the past before they disappeared. The member John Tempus says:

“Bitconnect also stated, ‘EVERYTHING IS FINE GUYS’ and then overnight it went to the gutter.”

In her audio message, Cheri Marks insists everything is going as normal and while promising that she and Clynton would soon return online to engage with members. Cheri implies in the audio that their mobile had been seized by FSCA officials.

At the time of writing, the MTI team had not put up the promised video that gives their version of events.

What do you think of MTI’s latest challenge? Tell us your thoughts in the comments section below.

The post South African Regulator Raids Home of Key Members of an Alleged Crypto Ponzi Scheme appeared first on Bitcoin News.

Leaked Data Outs Bitcoin Investment Company as Scam: Founders Deny the Allegations

22/09/2020 by Idelto Editor

A South African group calling itself “Anonymous ZA” has published fresh information that seemingly supports long-standing allegations that Mirror Trading International (MTI), an ostensible bitcoin investment company, is running a multi-level marketing scam. The new information, which was reportedly obtained after a breach of MTI internal systems, shows that the investment company is “entirely structured around a tree/pyramid scheme.”

According to a report, the leaked data suggests that MTI has a practice of distinguishing between “normal members and founder members.”

Assessing the data, Anonymous ZA says it would appear that while “deposits made by founder members are not easily traceable yet they (founders) seemingly get better ROI than regular members.” The data also shows that “founder members are also at the top of the pyramid scheme and earn more money from their binary bonuses than ROI or any other source.”

Perhaps in revelations that may lend credence to allegations often leveled against MTI, the report quoting Anonymous ZA says:

“The database further shows payouts of $ 86.25 million (8,171.6 BTC) to normal members, with $21.4 million (2,036.5 BTC) in the form of bonuses for referring new members. Payouts to founding members amount to $18.45 million (1,744 BTC).”

The report confirms that members are paid to recruit new members but it fails to provide the number of founding members.

Earlier in July, the Texas State Securities Board (TSSB) accused MTI of running a multi-level marketing scam as well, as it operated in the state of Texas without a license. The TSSB subsequently issued a cease and desist order against MTI and some of its employees. Afterward, the South African regulator, the Financial Sector Conduct Authority (FSCA) issued its own public statement which repeats allegations made by TSSB. However, the FSCA statement goes further by asking investors to withdraw their funds from MTI.

Anonymous ZA closes its statement in which it says “unless MTI can display or prove control of a Bitcoin wallet, or another storage facility to the value 17k BTC, it will stand by its view that: MTI is a Ponzi scheme.”

Meanwhile, following the latest revelations, the MTI management moved to confirm the breach in a fiery response. Cheri Marks, one of MTI’s founding members and spokesperson, suggests a criminal offense was committed by those behind the breach which occurred September 18. Marks then goes on to threaten legal action against the perpetrators as well those publishing stories based the illegally obtained information:

Yes, we had a security breach of our administration portal. Yes it was a criminal act. Yes we will be pressing charges and everyone publishing the personal information illegally obtained we will refer to our legal council.

Marks then attacks assumptions that MTI had stopped trading claiming that “in August over 34,000 withdrawals were effected to the tune of 5,933 bitcoin without so much as a hiccup.”

Throughout the rant, Marks challenges the media to name a single disgruntled investor out of the “170,000 that are growing their bitcoin with MTI.”

Still, Marks fails to adequately deal with concerns that founders are possibly getting larger payouts than the rest of investors. Instead, Marks chooses to boast about her status as founder saying:

“The fact that MTI has founder members is nothing new. Yes there is an extra profit share for them and this does not affect the company or the members in any way, nor is it a state secret.”

Throughout the seventeen-minute video, Marks complains of media bias and the “intention to slander, not to provide a decent and informed view of MTI, its founders, shareholders or members.”

Marks also briefly discusses MTI’s interactions with FSCA but fails to provide a satisfactory answer to why the regulator still went ahead and asked investors to withdraw funds even after the MTI “CEO opened our live trading account and BTC balance for the FSCA to see.”

Surprisingly, just after the encounter with FSCA, the investment company made the decision to invest in bitcoin only. Critics argue the move was intended to remove MTI from the tutelage of regulators. Meanwhile, reports say the FSCA has been made aware of the data leak and is looking into it.

What are your thoughts about the latest revelations on the MTI scam? Tell us what you think in the comments section below.

The post Leaked Data Outs Bitcoin Investment Company as Scam: Founders Deny the Allegations appeared first on Bitcoin News.