A series of late court filings made by lawyers representing investors in Mirror Trading International (MTI), has caused a South African judge delay the hearing of the liquidators’ application to declare the online bitcoin scam an illegal business.

Concern over Implications of Declaration Order

As a Mybroadband report explains, the investors’ belated decisions to oppose the motion stems from growing concerns that such a declaration would give liquidators too much power. Clynton and Cheri marks, co-masterminds in MTI, had opposed the liquidators’ motion before the latest counter applications.

However, as the report states, other investors have now come to the conclusion that the liquidators could be “seeking powers that would allow them to claw back the withdrawals of all members, even if they lost money in the scheme.”

Investors have also been warned that if MTI is declared a Ponzi scheme or pyramid, all proceeds would be declared proceeds from a criminal enterprise. This would mean that they would not be able to recover some of the funds they invested, but would have to repay what they took.

Liquidators Refute Claims

Nevertheless, liquidators have refuted the claims, according to the report. They insist they “will only be entitled to recover payments made to investors which were not legally owed to them.”

MTI, which was branded the largest bitcoin scam in 2020, collapsed after the firm’s CEO Johann Steynberg disappeared. Since then, court-appointed liquidators have been attempting to recover all bitcoins associated with MTI but have encountered resistance mainly from the Markses. Some believe liquidators can pursue those who unduly profited from the scheme if they have the declaration.

Meanwhile, in addition to setting the new hearing date, the judge’s order also directs the applicants to supplement their affidavits in support of the relief that they seek by September 30, 2021. Financial Sector Conduct Authority (FSCA), has been given the option to file a second affidavit at any time.

Similarly, both opponents and supporters of the motion “to have MTI declared an unlawful scheme have until September 30, 2021, to file an affidavit in support thereof.”

Do you agree with the liquidators’ push to have MTI declared an unlawful scheme? Let us know what you think below.

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