South Africa’s biggest pyramid scheme pulled in scammers from everywhere — including China, Saudi Arabia, and Ukraine

Lawyers for the liquidators of Mirror Trading International have recommended against pursuing scammers and other “net winners” in 30 countries.

Correspondence between law firm Schabort & Potgieter and the liquidators itemised estimated withdrawals in 23 countries worth nearly R522 million that they don’t believe is worth going after.

Saudi Arabia, Venezuela, Mexico, Cuba, Ukraine, Haiti, and Hungary were the countries with the highest estimated withdrawals from this list.

The attorneys said withdrawals in Saudi Arabia were around R104 million (79.45 bitcoins), while members in Hungary had withdrawn roughly R16 million (12.5 bitcoins).

Schabort & Potgieter’s letter to the liquidators was filed as part of a pack of court documents responding to an attempt to convert the liquidation into a business rescue.

It confirmed that Mirror Trading International (MTI) was a truly global scam.

Launched in 2019, MTI drew in serial scammers and victims alike by promising average monthly returns of 10%. It also allowed members to earn substantial bonuses by recruiting more people into the scheme.

The Western Cape High Court declared MTI a pyramid and Ponzi-type scheme in April 2023. Several attempts were made to appeal the ruling — all failed.

MTI made headlines in September 2020 when a group calling itself Anonymous ZA exploited vulnerabilities in the scheme’s poorly-coded website.

Together with a MyBroadband investigative journalist and community members, the group exposed the inner workings of MTI.

The scheme collapsed in December 2020 after its founder and CEO, Johann Steynberg, disappeared while travelling in Brazil.

Steynberg was arrested in Brazil almost exactly a year later for using a fake ID.

He was found guilty and his sentence commuted to a roughly R595,000 fine. He was also remanded into custody and later transferred to house arrest pending his extradition hearing.

Last month, a Brazilian news outlet reported that Steynberg had died after suffering a massive bilateral pulmonary thromboembolism.

MTI was by far the largest pyramid or Ponzi scheme ever in South Africa.

The recently filed court documents state that members deposited 39,193.3 bitcoins into the scheme.

Even using the much lower price of R500,000 per bitcoin at the time of the scheme’s collapse, MTI would be an almost R19.6 billion scam.

This is much larger than scams like Krion, Travel Ventures International, BHI Trust, and Africrypt.

MTI’s liquidators have started aggressively pursuing everyone they can find who withdrew any bitcoin from the scheme.

They have issued hundreds of summonses to MTI members in South Africa who withdrew funds from the scheme.

The liquidators’ attorneys also issued 187 letters of demand in the United States, followed by 149 adversary complaints and an omnibus motion in the state of Florida.

They are also pursuing net winners of the scheme elsewhere in the world, including Canada, Belgium, the UK, Namibia, Australia, Sweden, Botswana, and Germany.

According to Schabort & Potgieter’s report, they are investigating going after former members in countries like China, the Philippines, Spain, Portugal, Ireland, Mauritius, Nigeria, and Ghana.

However, there are also a few countries where the liquidators’ attorneys have advised against pursuing anyone for various reasons.

These range from the amounts not being substantial enough, to struggling to locate a solid local correspondent.

The table below summarises the countries the attorneys recommended not proceeding in.