FSCA opens criminal case against MTI, says investigation ‘nearly complete’

MTI responds that this is another attempt by the FSCA to destroy its business.
The FSCA says it has, in the last few days, received complaints that investors were unable to redeem their investments. Image: Shutterstock

The Financial Sector Conduct Authority (FSCA) says it has opened a criminal case against Mirror Trading International (MTI) and on Thursday issued a statement providing details of its investigation into the company, which it says is nearing completion.

Last month the FSCA conducted a search and seizure raid on the offices of MTI and the homes of some of its executives, after previously warning the public against investing in the company which has been promoting its bitcoin investment scheme with returns of up to 10% a month.

Despite the FSCA warnings, the number of MTI customers appears to be growing. Marketing executive Cheri Marks told Moneyweb that the company now had 280 000 customers worldwide.

“The Authority [FSCA] believes that MTI and its senior management are conducting an illegal operation, misleading clients and have contravened several laws,” says the FSCA statement.

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Marks said she was not aware of any criminal case against MTI.

Head of investigations at the FSCA, Brandon Topham, says the case was opened on November 12 in Stellenbosch (where MTI’s head office is located) under case number 245/11/2020.

The FSCA maintains that MTI is trading illegally and requires a financial services provider licence – which it does not have. MTI argues that its activities fall outside the jurisdiction of the FSCA, though it would be happy to comply with proposed regulations if and when these are introduced.

MTI was originally trading forex through an offshore broker, then switched to trading in bitcoin when its forex activities were halted.

The company claims to have generated positive returns for more than 200 days, with only one day losing – notwithstanding the switch from forex to bitcoin trading.

The FSCA statement provides some background on MTI and its trading activities.

“During October 2020, after the FSCA informed MTI that it was an conducting illegal unregistered financial services business, MTI claimed that it changed its trading activities to trade in derivative instruments based on crypto currency [bitcoin], so that it no longer fell within the jurisdiction of the FSCA, and that it no longer required an FSP [financial services provider] licence. This is also incorrect as the submissions received from Steynberg [MTI CEO Johann Steynberg] revealed that the crypto was alleged to be traded in the form of a derivative product, which would have required registration with the FSCA as well. We have found no evidence that any crypto trading is being conducted as communicated with members of MTI.

“MTI, Steynberg, and Cheri Marks claim that the trading activities of MTI were from FXChoice to Trade300, transferring all the clients’ crypto assets from FXChoice to Trade300.

“According to Steynberg, Trade300 is another online trading platform. At Trade300 MTI experienced the same extraordinary profits utilising the bot – but at this stage trading in crypto derivatives.

“Steynberg stated under oath and repeatedly in the press that the bot [computer algorithm] trading averaged a return of 10% per month, and that MTI has never had a negative profit trading day, but for one exception. Marks also repeatedly confirmed the trading successes on social media.”

The evidence uncovered by the investigation

The FSCA says it obtained evidence from FXChoice, a Belize-registered online trading platform, that is in complete contradiction with the claims of Steynberg and Marks.

“According to FXChoice they received queries from clients of MTI and in the process the clients provided FXChoice with trading statements. The source of the trading statements was MTI. These trading statements were based on demo trading accounts and not actual trades.

“As a result, FXChoice froze the balance of the crypto assets linked to MTI on the FXChoice platform.

“However, the total frozen crypto assets on FXChoice is a negligible amount, taking into account the total assets that MTI claimed it invested on behalf of its clients. FXChoice 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%.”

The FSCA says it attempted to track down Trade300 to obtain a statement and trading details from it to verify the version of MTI. MTI did not provide any useful details that assisted the FSCA.

Does Trade300 exist?

The FSCA also followed all possible links on the internet to establish whether Trade300 existed.

It could only find one reference to Trade300, being the website of Trade300. However, the website was and still is “under maintenance”, and the only reference linked to the website is the name of “Joe Steyn”, a known alias of Steynberg.

The FSCA obtained search and seizure warrants and executed them at the homes of Steynberg and Marks, and the offices of MTI. On the desktop computer of Steynberg the investigation team found evidence relating to Trade300. It would therefore appear that Trade 300 is linked to Steynberg.

As a further effort to verify the evidence of MTI, Steynberg and Marks, the FSCA requested information from MTI about the transfer of clients’ assets from FXChoice to Trade300. MTI, in support of its assertion, purported to provide proof of the transfer in the form of bitcoin wallets, stating that MTI transferred 16 444 bitcoin from FXChoice to Trade300 in four instalments on 21 July, 22 July and 24 July 2020 respectively.

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

“The transfers were made from wallets with transaction activities which bear no resemblance to the purported activities of MTI.

“We have found no evidence of any significant store of crypto assets on any trading platform and that most crypto balances appear in the name and under control of Steynberg.

“The amount of such balances is well below the advertised balance on the MTI trading platform as being due to investors of MTI.

“In the last few days, we received complaints that investors were unable to redeem their investments.

“The investigation is ongoing, and a criminal case has been opened by the FSCA with the South African Police Service.”

MTI’s response

Asked to respond, Marks says this is again tactics from the FSCA to sow discord and panic among the MTI membership.

“They are still in the very early stages of the investigation by their own admission. They do not understand our business and don’t want to understand it. Who are they trying to protect? Is it the banking institutions, themselves, or [is it] MTI members?

“MTI is making a difference in people’s lives that they [the FSCA] cannot understand, particularly during these tough economic times.”

MTI said its legal team would provide a more complete response in due course. The story will be updated as and when we receive this.

Listen to Ciaran Ryan’s interview with Brandon Topham, head of enforcement at the FSCA:

 

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Right. I wanna hear the comments of both the hawks and doves of this MTI thingy.

What now? Who has lost what? I like shares.

I’m making microwave popcorn in anticipation of the trolls, sorry, ‘investors’, crawling out of their holes and posting multiple, hysterical comments, appalled at the thought that the investigators may come knocking to recover the huge ‘profits’ their ‘investments’ made.

Looking at your comments here and on other threads, it seems that you are conflating BTC with a ponzi scheme that utilized people’s BTC.

@Trubit – yet another fake profile and shill for these shysters. Cheri, is that you?

I have tried this MTI thingy. Coincidentally or otherwise, I am also invested in EC 10, formerly DCX 10, which is a crypto asset listed on the JSE (excuse me if I haven’t captured the listing nuances correctly).

If you have knowledge of the performance of former DCX 10 over even the past months, you might agree that the performance of MTI becomes quite realistic.

I’m not here to take on a side, but I’ve read most of the FSCA warnings and or notes in connection with MTI. The FSCA has done a poor job at articulating precisely why investors should keep their money away from MTI. The CEO or Founder of MTI also seems to have been misquoted quite often. I don’t recall him saying that 10% monthly returns are guaranteed on MTI. I also don’t recall achieving such returns myself. So who is to believed here?

Lastly, my returns on MTI have been no better than my returns on say, the NYSE. Zoom made me better returns than MTI, so did several other counters.

MTI trades your Bitcoin on your behalf. Perhaps the clarity required is, is an FSP Licence required to trade investor’s Bitcoin on their behalf? All the other noise and humiliation do not answer this question, although many comments above would suggest otherwise.

Could investors please have facts and legally sound answers? Thank you.

Haleluja, about time, please lock these jokers up once and for all, they all serial scammers and should have been brought to book ages ago, in fairness to the FSCA they have warned people on numerous occasions telling them to beware and to withdraw their funds out of this scheme….greeds a blixem. Sad Xmas for many

Yup, @Incactus, Popcorn and Coke time.

@ Bobby Dollar I agree with your sentiment but these “Investors” will NOT have a terrible Xmas, they will be happy in the comfort of their investment and will be looking at the 10% a month they ARE earning, they will only realise when they go to draw their funds.

However these schemes do destroy peoples lives which is tragic.

…eagerly awaiting the MTI sheeple to flood the comment section, trying to defend the indefensible.

Www dishonest co za

Strange. I followed ypur link and it to took me to the ANC website.

*lol*

Brandon Topham distracts attention from himself. He was a director of the failed Ecsponent. I surely hope he will get investigated for this failure. These companies do not just fall over. Brandon Topham must do this good act, return to Ecsponent and find all the investors money and assist them to get it back. Let him first sort out his own responsibility.

Absolutely. I engaged Brandon Topham as far back as January 2012 about problems with Ecsponent, and I have the emails to prove it.

Yawn, if you dont take FSCAs word for it, try the Texas securities board. Good luck getting your BTC back from those lovely people who only want to “change peoples lives” …well they sure did that, just not in the manner how they thought possible

And not a moment too soon!

“The Authority [FSCA] believes that MTI and its senior management are conducting an illegal operation, misleading clients, and have contravened several laws,” says the FSCA statement.

It’s about time that these ” ***-token” traders realize that they cannot do what offshore traders are doing by arbitraging in these tokens, due to local regulations, laws, and exchange control.

They acted as if they are a ”unregulated” law above the law. Well done to the FSCA for bringing their mystical million shenanigans to an end by laying criminal charges.

I contacted them directly in September and asked them the following question with regards to the regulations, and requested them to quote me their FSP number.

‘’South African asset managers must register as financial service providers (FSPs) with the Financial Services Board (FSB) under the Financial Advisory and Intermediary Services Act (FAIS). Any person carrying on asset management business in South Africa, or from abroad directed at South African clients, whether in a discretionary or non-discretionary capacity must be licensed as an FSP under FAIS’’

This is the reply I got:

”We acknowledge receipt of your email and the contents thereof.

Further communication with you on the issues you have raised will be done through our attorneys if we chose to do so
We reserve all of our rights”

What an arrogant way of answering an email that was addressed to obtain information!

The FSCA needs to make an example of these guys – ”HangEmHigh” – they failed to adhere to your regulations and warnings!

Agree fully…next stop please look into Andrew Eaton, Tony De Gouveia and their MLM schemes

Wonder when Ovex is going to be investigated.. I reckon they are in a similar boat.

I have asked them to quote their FSP number on a plethora of Moneyweb posts – but to date, they failed to ”pitch” anything!

Greed is a savage emotion .. if it is too good to be true…..

If this is an “open and shut case”. Why is it not shut??

Maybe the cops that have to follow up on the “criminal case” are investors?? Hahahaa.

What’s taking so long???

Guess the only answer to that is it is not an open and shut case then..

Firstly, 10% per month is possible. It is not arbitrage. It’s skimming 0.5% of divergence per day. I do this without a robot.
Do you need a licence to trade someone’s money, yes
Is mirror trading, trading someones money, it should not be. It should be your own account which you choose to link and mirror someone elses trades.

I don’t know MTI but I know technology has made it possible to achieve these results.

Wow. So every 4 months or so, you’re doubling your money. You’re no doubt making these allegations from a gigantic villa in Monaco, and thinking where you’re flying your Lear Jet for the weekend?

Didn’t think so. Troll.

Hey @ Incitatus. I take it Math’s is not your strongpoint hey??

Whahahaaaaa!!!!

Hey Dummmmmmmmm…..The original post alleges a gain 0.5% per day. Try the following calculation in Excel: (1+0.005)^140 (the 140 is days, a bit more than 4 months, and the 0.005 is 0.5% per day).

The answer you will get is around 2. Doubling your money in just over 4 months, in other words.

And another shill’s utter numerical illiteracy is exposed, bwahahahahaha!

There is a lotto-winner every week. Technology, the spinning of a dice, a ball, or a string of computer-generated numbers, has made this possible as you mentioned.

This is not the issue, however. Never in history has the same person won the lotto twice. Consistency is the foundation of sustainable profit. Anybody, especially fools, can be lucky, but very few are consistent winners. This is the difference between amateurs and professionals.

“Never in history has the same person won the lotto twice” – you clearly don’t know your history

Really a pity, this is a perfectly legitimate Ponzi scheme 😉 using the valid crypto sphere as playing field.

Did the FSCA ever managed to uncover the way that their impressive “trading bot” worked? Or did the bot merely transfer crypto from Peter to pay Paul, in an impressive way…. *lol*

(…and why the heck would you relinquish control of your crypto wallet to such schemes?)

In a cynical way, I much give the master brains behind this scheme, credit in devising such a scheme to cleverly mislead people. Impressively camouflaged.
On the other hand, it seems like every week a newly devised MLM (in the crypto shere) sees the light.

I have less than zero sympathy for these ‘investors.’ Because, if the so-called bot actually worked, why would the owners of the so-called bot want to share its profits? Any losses the ‘investors’ suffer, would be well-deserved and is known as a stupidity tax.

I agree, Incitatus & Bobby Dollar 🙂

If this bot was so exceptional, MTI should’ve just offered it for sale in the global financial/trading market long ago for a few $Billion….large corporations would fall over their feet to acquire this money making ‘wunderbot’.

Then MTI’s founders would’ve earned real (and legit) Fiat money, and retire ion peace, instead of battling litigation from any financial regulators 😉

Will check out the G999 scheme √

New one appears to be on its way: G999 keep an eye on this new *BS* “opportunity of a lifetime”

I suppose naming it G666 would have made it too obvious!

Still waiting for the FSCA to investigate MyWealthMethod – they are running a similar ponzi scheme. Ironically, they even mention MTI as one of their investment “opportunities”. They are going around Cape Town and Namibia continuing to scam people and even offer some members “recruitment fees/payments” for soliciting more clients for them.

What about MW doing an investigation into MyWealthMethod

Another Stellenbosch financial crime scheme and like with Markus Jooste / Steinhoff the bleat from MTI is that their business is not understood and their lawyers will provide a more complete response in due course.

BUT please, isn’t it friggin time joe public learnt that these get rich quick systems are always just a scam. Suppose it’s a truism that there is a sucker around every corner…

Looking at the previous article re MTI (“MTI plans countersuit after FSCA raid on offices and homes of execs”) there were 112 comments, of which a surprising number were in defence of MTI, some vehemently so. Where are those folk now? Also, where is MTI’s “countersuit”?

Yarwell no fine – ”The surest way to make a monkey of a man is to quote him” Robert Benchley (1889-1945)

I asked legitimate questions (like I was taught when I did my RE exams – mind you)i.e. what is your FSP number as it became clear to me that they ”claimed” that they were trading FX, etc.

They replied by threatening me with their lawyers…haha – I am still waiting!

Agree, they keep throwing Ulrich Rouxs (apparently son of Barry Roux / Oscar Pistorius defence lawyer fame) name about and has appeared on MTI Zoom calls. According to many comments listed on Mybroadband Roux or his associates are percieved to be investors/members in MTI, however this plays out one wouldnt want any funds tied in this MTI nonsense, its probably sadly too late for many to withdraw funds now

They on holiday enjoying all those fake profits they going to be receiving when they cash in.:)

Nice while sh!tcoin is going up, but it corrects by 30% regularly and that will wipe out you derivatives.
Also, one day it might just crash in value to zero.

So, you do not believe the market price placed on Moneyweb daily. Did you know that bitcoin is daily quoted by price as a currency? If you had placed R100,000 in bitcoin in March when the price was $5300 and now it is around $22,800 you would be a believer. But why will you buy bitcoin now? You will rather wait till the price is $100,000 per bitcoin. You will buy it, you will just not tell anybody.

Bitcoin is flying, no doubt about it, problem is due to no real regulation unsuspecting desperate people (more so since the onset of Covid) are jumping into dodgy scammy schemes like MTI to cover their daily needs without even understanding what they into, the sooner Bitcoin has some form of regulation the better….even the Winkelvoss twins want regulation, regulation will bring more certainty and mean easier adaption of BTC into the system, what people dont need are scammers operating BTC schemes like MTI

Another company called Global TradeATF after registering for R3 500 I received a phone call from a guy trying to convince me to invest R100 000 into Moderna who made a breakthrough on the COVID 19 vaccine. The shares in Moderna since I was given this call have gone up by about 400%. I was to afraid to hand over so much money to strangers and refused to invest. Then another person phoned me telling me how to make money out of the R3 500 I paid on registering. You go on their Website and buy euros or dollars when the price drops and when the price increases you sell. Every hour he phones and shouts when you must buy and when to sell. I got tired of being pestered and although It looked legit I wanted my money back and actually after a couple of days it was paid back into my account. After my money was paid back to me this person phoned me again and said I was given back my money which proves that they are legit and I must join them again. I think I had a lucky escape and are thinking of blocking their phone numbers on my mobile.

Some people just like to gamble. The thrill of it ? Even addicted gamblers should know better to stay away from games that are run by characters like Cheri Marks.

Hopefully when they arrested someone opposes bail, Steynberg has been quite vocal about his new Liberland citizenship. These guys will skip the country faster than you can say Jiminy Cricket.

End of comments.

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