Liquidators demand R4.6bn
PONZI SCHEME: MONEY WILL PAY MIRROR TRADING INTERNATIONAL’S DEBTS TO CREDITORS
Claims filed with court to obtain order declaring Steynberg and 17 others liable.
The joint liquidators of Mirror Trading International (MTI) are claiming more than R4.6 billion from 18 masterminds in the scheme called the biggest scam yet. The money will enable the liquidators to pay MTI’s debts to its creditors.
The six joint liquidators also filed alternative claims with the High Court in Pretoria to obtain an order that declares the insolvent estates of kingpin Johann Steynberg and the 17 other defendants liable, jointly and severally, to pay to the liquidators the money, plus interest.
The claims include an order declaring the insolvent estate of Steynberg – represented by Jacques André Fischer and Reunert Ndivhuho Kharivhe – as well as 17 other defendants, are liable in terms of section 424 of the Companies Act for all the debts and liabilities of MTI.
The other 17 people are:
► Charles Thomas Ward;
► Monica Coetzee;
► Joseph Usher Bell;
► Frederik Coenraad Rademan;
► Clynton Hugh Marks, who owns 50% of MTI;
► Cheri Marks, Clynton Marks’ wife who was responsible for the marketing of the scheme;
► Maria Matshidiso Ramanamane;
► Thomas William Fraser;
►Elizabeth Kathleen Malton;
► Romano Lorenzo Samuels;
► Jacobus Eckley;
► Vincent Ward;
► Leonard Wesley Gray;
► Andrew Gran Caw;
► Nerina Steynberg (wife of Johann Steynberg);
► Gerald Lassen; and
► Don Nkomo.
The liquidators are also seeking an order declaring Steynberg and the defendants named above are liable for all the liabilities and losses incurred by MTI.
They are also asking the court to set aside the depositions made by MTI to Steynberg and the people named in the list of defendants, except Rademan, in terms of the Insolvency Act.
According to the abstract of the liquidators’ heads of argument filed with the court, Steynberg and the other defendants who were part of the MTI’s “management and marketing team”, told people the investors’ bitcoin were pooled and held in one account with a broker.
They also said MTI was trading very profitably on trading platforms, making daily profits; that MTI has never made a loss, except for on one day; the bitcoin trading pool was growing every day; and MTI’s bitcoin investments were continuing to grow by at least 1.5% per month.
In addition, they said MTI was able to produce positive trading results every day due to an exceptional electronic code, or bot coded by Steynberg, or someone he appointed.
This bot had artificial intelligence and could project foreign currency trades with such accuracy that it would, with great precision, predict trading activity in foreign currency (“forex”) markets.
Contrary to what was represented to MTI investors and the public, MTI never achieved any growth in bitcoin as a result of trading activities, it could never reflect such growth in bitcoin to investors and MTI could never, from any bona fide trading activities, pay investors their bitcoin withdrawals and growth in bitcoin. MTI simply used bitcoin received from later investors to pay earlier investors.
MTI also conducted a collective investment scheme without being registered as a manager, directly or indirectly promoted, knowingly joined, or entered into and participated in a fraudulent financial transaction in contravention of the Consumer Protection Act.
Having conducted an unlawful Ponzi scheme, MTI was factually insolvent from inception.
Other reckless or fraudulent trading included defrauding the MTI creditors; no corporate governance; no transparent financial accounting or bookkeeping; and no registration for MTI employees’ tax or value-added tax.
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