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South African Regulator’s Probe Into Mirror Trading International Unearths Previously Undeclared Losses and Missing Bitcoins

South African Regulator's Probe Into Mirror Trading International Unearths Previously Undeclared Losses and Missing Bitcoins

South African financial regulator, the Financial Sector
Conduct Authority (FSCA), has filed criminal charges with local law
enforcement against Mirror Trading International (MTI), the alleged
online bitcoin trading scam. The regulator says its decision to
press charges follows an investigation into MTI that unearthed the
company’s use of fake trade statements, undeclared losses, and
possible fraud involving thousands of bitcoins.

Bogus Trading Statements

The ongoing probe’s preliminary findings seem to contradict
claims by MTI’s executives that their company’s trading bot has
“averaged a return of 10% per month, and that MTI has never had a
negative profit trading day, but for one exception.” The findings
also appear to contradict past denials by MTI CEO Johann Steynberg,
who was slapped with a
cease and desist
order by U.S. regulators, that his
organization is running a scam operation.

According to a
issued on Dec.17, the FSCA accuses MTI’s executives
of repeatedly using “trading statements based on demo trading
accounts and not actual trades.” The practice, which is seemingly
intended to reassure investors of MTI’s profitability, was
uncovered by FX Choice, a Belize-registered online trading

by, FX Choice blocked MTI accounts
after discovering that the latter was running a multi-level
marketing scam. Meanwhile, as part of its investigation, the FSCA
says it reached out and obtained evidence from FX Choice which
proves that MTI actively engaged in an effort to mislead its

After its relationship with FX Choice ended, MTI started dealing
with another online trading platform, Trade 300. Interestingly, the
FSCA says it found evidence on a desktop seized during a
on the residence of one MTI executive suggesting 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, investigations show that “the total (number of) frozen
crypto assets on FX Choice is a negligible amount” when compared
with “total assets that MTI claimed it invested on behalf of its
clients.” The FSCA explains this inconsistency as follows:

FX Choice confirmed that MTI put in 1846.72 bitcoin from 29
January 2020 until 3 June 2020 and made a loss of 566.68 bitcoin,
an approximate capital loss of 30%.

Yet 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 21 July 2020; 22 July 2020 and 24 July 2020

Meanwhile, after conducting its own investigation, the FSCA says
it found no evidence to support MTI’s claim that it did transfer
the 16,444 BTC. The regulator

The FSCA found that no withdrawal of bitcoin by MTI from FX
Choice occurred in July 2020. The last withdrawal of bitcoin by MTI
from FX Choice was conducted in August 2019. Further, FX Choice
confirmed that none of the eight sending wallets is related to FX
Choice and that FX Choice had neither received deposits from nor
sent any payments to any of the eight bitcoin wallets.”

Perhaps in a sign that the MTI bitcoin scam is beginning to
unravel, the regulator reveals that it has been receiving
“complaints that investors were unable to redeem their
investments.” On social media, which Steynberg and his associates
used widely to refute scam allegations, anxious investors are
complaining of “delayed” withdrawals.

What are your thoughts on the findings of the FSCA
probe? Tell us what you think in the comments section

The post
South African Regulator’s Probe Into Mirror Trading International
Unearths Previously Undeclared Losses and Missing Bitcoins

appeared first on Bitcoin

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