Cryptocurrency has been making headlines of late, thanks to an explosion in its value. While its never been easier to trade these virtual tokens, authorities have had a tough time tracking down those who abuse its use as an investment vehicle for ill-gotten funds. Investigators from the Federal Bureau of Investigation (FBI) have now joined the fight to catch those who use digital currencies to launder money, and recover funds for investors.
Earlier this week, the FBI conducted a series of raids in multiple African countries as part of a large-scale investigation dubbed as “Operation Integra” that targets a company named as “Tendermint”, a global business hub that specializes in crypto exchange and trading platforms.
An anonymous US investor, whom we have chosen to call Ray, contacted us on behalf of his friend, who is an American citizen living in Nigeria. Ray, who asked to remain anonymous, claims that his friend has been targeted by an international crime ring since 2016, who is using a computer program called Mirai to exploit vulnerabilities in an industry-wide effort to protect the equipment used in internet-connected devices. The Mirai malware is used to hijack the internet of things (IoT) devices, such as CCTV cameras, electric meters, and routers, that are then used to carry out a series of cyber-thefts, often of large sums of money.
Mirror Trading International (MTI), a South African business generally regarded as last year’s most heinous Bitcoin (BTC) Ponzi scam, is currently being investigated by the US Federal Bureau of Investigation (FBI).
MTI claimed to have over 260,000 members in 170 countries at its peak, before going into provisional insolvency in December 2020. It initially came to the notice of authorities in Texas in July of last year, when its activities were swiftly shut down. In August 2020, the Financial Services Conduct Authority (FSCA) of South Africa released its own statement, saying that the business lacked a required license and was promising investors unrealistic, fanciful profits. Existing MTI customers were urged by the FSCA to seek immediate refunds.
The liquidation team in South Africa has been trying to track down MTI’s assets since the scheme’s collapse, with the firm estimated to have owned approximately 23,000 BTC worth around $874 million at today’s pricing. Since January, the team has been looking for new abilities to assist their efforts.
Five MTI trustees said in an email to Bloomberg that they had now “met with international law enforcement agencies like the Federal Bureau of Investigation, after being approached by them,” revealing that “the FBI is joining forces with the liquidators of Mirror Trading International in the interest of several U.S. and local investors.”
As previously reported, purported internal MTI correspondence has been leaked, implying that the company’s top officials were unaware of the scheme’s activities, with MTI CEO Johann Steynberg being the only person with complete authority.
South Africa learns a harsh lesson in crypto despite soaring demand
“Although there is a paper trail (airplane ticket) indicating [Steynberg’s] potential flight attempt to Brazil,” the liquidators wrote to Bloomberg, “no video or picture proof could be acquired that he actually depart the country.” Since December 2020, Steynberg has been missing.
Some of the victims of a large alleged crypto heist in South Africa this spring, linked to the Africrypt investment scheme, had previously transferred their money to MTI, according to a senior official at the South African crypto exchange Luno.
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