Mirror Trading international (MTI), self-proclaimed cryptocurrency investment and trading platform, has seen significant pushback from regulators for its supposed fraudulent nature. While the company has maintained its innocence over time, the evidence against it continued to mount.
Exposing MTI’s MLM Scheme
In the latest allegation against the South African firm, a local whistleblower group has released a trove of information that incriminates MTI even more. According to local reports, the group, which calls itself Anonymous ZA, shared several documents showing that MTI has been running a multi-level marketing scam.
As reported, the group had broken into some of MTI’s internal systems and obtained the information. For instance, the leaked documents showed that MTI had a practice of distinguishing between “founder members and normal members.”
Examining the data, Anonymous ZA explained that it hadn’t had much luck tracking the deposits from founder members. However, these members also seem to be getting higher returns than regular members. The data also showed that the founder members were the ones higher on the pyramid structure.
Quoting the group, the report states:
“The database further shows payouts of $ 86.25 to normal members, with $21.4 million in the form of bonuses for referring new members. Payouts to founding members amount to $18.45 million.”
The report also pointed out that most normal members get paid as they recruit more members. Considering that this is one of the most prominent features of a pyramid scheme, it appears to be pretty damning.
MTIs Bad Year Gets Worse
Currently, MTI is facing multiple allegations of criminal activity from regulators at home and abroad. Early in July, the Texas State Securities Board (TSSB), announced that it had successfully shut the company and its operations down in the state.
In a statement, Securities Commissioner Travis J. Iles accused MTI of having duped investors into sending Bitcoins. While it claimed to send the assets to unidentified forex brokers for automated trading using artificial intelligence, the firm merely misappropriated them.
The TSSB also highlighted that MTI had been recruiting unregistered salespeople to drive its investor base, promising these people a 10 percent ROI rate per month. MTI’s founder, Cornelius Johannes “Johan” Steynberg, was also accused of misrepresenting and concealing crucial company information from the public. This includes their forex broker, the company’s background, and the AI system that it used for conducting trades.
Last month, the Financial Services Conduct Authority (FSCA), the financial regulator of its home country — South Africa — also issued a warning telling people not to do business with MTI. As a statement explained, MTI offers high-frequency derivatives trades on behalf of clients. Such a business model requires a license from the agency, and MTI currently doesn’t possess any.
Like the TSSB, the FSCA noted its concerns with the returns that MTI was offering investors. As it explained, 10 percent monthly was “unrealistic and far-fetched.” The agency also expressed doubts over whether MTI’s alleged 2.9 billion Rand (about $168 million) in clients’ funds and assets ever existed.
Whether or not the funds existed, the FSCA asserted that MTI’s lack of a business license to operate in the country made it a risk. Now that proof of its fraudulent nature continues to mount, it’s only a matter of how long the company can keep operating.