June 16, 2024

Liquidators from the closed Mirror Trading International (MTI) pyramid scheme are issuing summons to all clients they can locate who made withdrawals within six months before the filing of the scheme’s original liquidation application on December 20, 2020.

The summons instruct former members to return all Bitcoin withdrawn or repay the current value of the cryptocurrency in Rands.

This decision severely impacts some victims. For example, those who bought 0.01 Bitcoin for R1,670 ($90.72) on July 1, 2020, now need to repay over R12,000 ($651.85) to the liquidators.

The decision to reclaim full withdrawals, not just profits, is justified by the liquidators as ensuring fairness among all victims.

“The effects of Section 29 of the Insolvency Act are viewed by unsuspecting investors as overly harsh and unreasonable,” noted Herman Bester, a liquidator for MTI.

As Bester explains, the legislation is designed to balance the interests of creditors who lost everything and clients who withdrew some or all funds before the scheme’s collapse.

Not just limiting their focus to South African members, the liquidators lodged around 200 complaints against net winners in the United States.

In Australia, 5,250 supposed profiteers are targeted, and the liquidator claims authority to also pursue members in Belgium, Canada, and the UK.

Those pursued include associates of Johann Steynberg, the late former CEO of Mirror Trading International. Steynberg died in April 2024 while under house arrest in Brazil, but significant figures in his pyramid scheme remain free.

Moreover, the South Africa National Prosecuting Authority (NPA) considers charges of fraud or theft, forgery, contraventions of the Prevention of Organized Crime Act, and contraventions of the Financial Advisory and Intermediary Services Act against these individuals.

Members needed to buy into MTI with at least $100 worth of Bitcoin, or a minimum of $200 to be eligible for the company’s multi-level marketing system bonuses.

The scheme, dubbed the largest scam globally in 2020, is estimated to have received between 29,421 to 46,000 bitcoins and is South Africa’s biggest Ponzi-like scheme to date.

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Frequently Asked Questions

1. Who are the MTI liquidators?

The MTI liquidators are a team of professionals appointed by a court to administer and manage the liquidation of Mirror Trading International (MTI). They are responsible for finding and selling assets to repay creditors.

2. What is the process of liquidation at MTI?

The liquidation process involves freezing all company assets, collecting the existing debts, selling assets to pay creditors, and ultimately dissolving the company. MTI liquidators have also taken steps to recover bitcoin withdrawn by former members.

3. What was the Mirror Trading International a scam scheme?

Mirror Trading International was a Bitcoin-based investment scheme that was eventually deemed a pyramid scheme. Members needed a minimum investment to join and could earn bonuses by recruiting more members. It is believed to be the biggest scam of its kind to date in South Africa.