The US commodities regulator announced on Thursday it had filed civil charges against a South African man and his company for operating a fraudulent commodity pool worth over $1.7 billion in bitcoin.
The Commodity Futures Trading Commission (CFTC) said the fraud scheme, which saw the firm solicit bitcoin online from thousands of people to purportedly operate a commodity pool, was the largest it had ever pursued involving the cryptocurrency. The CFTC filed charges against Mirror Trading International Proprietary Limited and its CEO, Cornelius Johannes Steynberg.
The CFTC said in its complaint that the company claimed to have proprietary software that would realize significant trading gains for investors who pooled their bitcoin with it, but in reality no such “bot” existed.
The CFTC said approximately 23 000 Americans invested in the pool.