- It will be paid by the head of Mirror Trading Johannes Steinberg
- The amount is divided into two parts of $1.7 billion
Commodity Futures Trading Commission (CFTC) USA achieved a record $3.4 billion fine for bitcoin fraud. The defendant in the case was Cornelius Johannes Steinberg. The court found him guilty of a fraudulent scheme using foreign currencies and BTC.
Steinberg, a South African citizen and head of Mirror Trading International Proprietary Limited (MTI), will pay two equal amounts. $1.73 billion as compensation to the victims of the scam and another $1.73 billion as a civil monetary penalty.
Details and importance of the case
According to the findings of the court, Steinberg organized an international fraudulent multi-level marketing scheme. He lured bitcoins from investors, ostensibly to participate in an unregistered commodity pool (CPO). From May 2018 to March 2021, the businessman received at least 29,421 BTC worth more than $1.7 billion. And 23,000 people from all over the world became depositors.
The CFTC said that in fact, Steinberg directly or indirectly appropriated all the bitcoins that the company accepted from the pool participants.
This is the highest civil monetary fine in history issued in a CFTC case. And also an important milestone for the cryptocurrency market. The punishment will be a warning to those who defraud investors in the digital asset market. The case also highlights the need to strengthen the judicial branch in order to prevent scams and protect crypto depositors.
