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South African Regulator Seeks More Crypto Powers After Alleged Ponzi Schemer's Collapse
“At the point something becomes a Ponzi scheme, we have lost our jurisdiction,” a regulator told Bloomberg.
South Africa’s financial market regulator is seeking greater oversight of the cryptocurrency trading industry following the collapse of a bitcoin company alleged to have been the nation's biggest Ponzi scheme.
STORY CONTINUES BELOW
- Brandon Topham, head of enforcement at the Financial Sector Conduct Authority (FSCA), told Bloomberg Tuesday his agency is making new proposals to regulate cryptocurrencies in order to be able to prosecute fraudsters.
- “At the point something becomes a Ponzi scheme, we have lost our jurisdiction,” Topham told Bloomberg. “We need the police and the prosecuting authority to work fast and put people in jail.”
- The move comes after a recent FSCA investigation into Mirror Trading International (MTI), a bitcoin trading club that had allegedly been operating illegally and lied to investors.
- As reported by CoinDesk, MTI had claimed to be able to create profits of 10% per month by using bots to carry out high-frequency trading using client’s pooled bitcoin.
- The firm was declared fraudulent by Texas state regulators in July last year, and the FSCA probe concluded MTI deliberately misled investors and operated a financial service without a license.
Read more: Crypto Assets in South Africa Would Be Considered Financial Products Under Regulator Proposal
Tanzeel Akhtar
Tanzeel Akhtar has contributed to The Wall Street Journal, BBC, Bloomberg, CNBC, Forbes Africa, Financial Times, The Street, Citywire, Investing.com, Euromoney, Yahoo! Finance, Benzinga, Kitco News, African Business Magazine, Hedge Week, Campden Family Office, Modern Investor, Spear's Wealth Management Magazine, Global Investor, ETF.com, ETF Stream, CIO UK, Funds Global Asia, Portfolio Institutional, Interactive Investor, Bitcoin Magazine, CryptoNews.com, Bitcoin.com, The Local, The Next Web, Mining Journal, Money Marketing, Marketing Week and more. Tanzeel trained as a foreign correspondent at the University of Helsinki, Finland and newspaper journalist at the University of Central Lancashire, UK. She holds a BA (Honours) in English Literature from the Manchester Metropolitan University, UK and completed a semester abroad as an ERASMUS student at the National and Kapodistrian University of Athens, Greece. She is NCTJ Qualified - Media Law, Public Administration and passed the Shorthand 100WPM with distinction. She does not currently hold value in any digital currencies or projects.
