Investors in the bitcoin Ponzi scheme Mirror Trading International are reportedly resisting liquidators’ attempts to have them repay digital assets withdrawn before it collapsed. According to the investors’ lawyer, MTI liquidators are intentionally misinterpreting the Insolvency Act for their benefit.
Liquidators Face Accusations of Prolonging the Settlement Process
A group of Mirror Trading International (MTI) investors is reportedly opposing attempts to compel them to return digital assets, withdrawn from the collapsed bitcoin (BTC) Ponzi scheme, at current market prices. The 415 investors, who are represented by their attorney, John Lister of Lister & Company, accuse the MTI liquidators of intentionally misinterpreting the Insolvency Act for their benefit.
As per a report, the MTI liquidators are requesting investors who withdrew funds from the Ponzi scheme before its collapse to repay the local currency equivalent of the BTC withdrawn, but at today’s rates. When Johan Steynberg, one of the masterminds of the Ponzi, disappeared in December 2020, one BTC was trading below $29,000. However, at the time of writing, the price of one BTC has risen to just over $52,400.
In one case used to illustrate the investors’ gripe against liquidators, an investor is said to have bought BTC worth an equivalent of $1,057 in July 2020. A few months later he sold the same for approximately $1,110. However, liquidators, who are accused of dragging the liquidation process, have asked the said investor to pay a balance of just over $4,000 bringing the total to $5,130.
However, the investors’ lawyer has rejected what he sees as the liquidators’ misinterpretation of section 32(3) of South Africa’s Insolvency Act. Lister said:
“The Court expressly directed in this regard that any reimbursements to an investor and/or profit received should be calculated in the rand value as at the date upon which the relevant investor received such reimbursement/payment from MTI.”
Lister expressed concern that if the liquidators’ interpretation of the law is upheld, it would result in prejudice against his clients. He further argued that by requiring investors to pay at current market prices, the liquidators are, in effect, asking “investors to pay creditors with other people’s money.”
In a letter directed to the Master of the Cape Town High Court, Lister implored the court to dismiss the contentious Section 32(3) claim. He asserted that such a move would avert further litigation and facilitate the resolution of the matter.
Source: Bitcoin
