Tax Collector Wants $55 Million From MTI Bitcoin Ponzi Scheme Collapse – Liquidators Accused Of Failing To Do Their Duty

In a new twist in the Mirror Trading International (MTI) saga of the collapsed bitcoin Ponzi scheme, revenue collector South African Revenue Services (SARS) has demanded $55.3 million from the scheme’s liquidators. The tax collector added that he wanted the tax bill settled before the MTI liquidation process was finalized.

Liquidators fail ‘as reputable public officers’

The South African tax collector reportedly filed a claim of around $55 million against the now-defunct Bitcoin Ponzi scheme Mirror Trading International (MTI). The claim filed with the Master of Cape Town High Court relates to two tax periods, the years 2019 and 2020.

According to a Moneyweb report, the revenue collection body known as the South African Revenue Service (SARS) said it wanted this tax bill settled before the liquidation process for MTI was finalized. As previously reported by News, a total of $75 million was made from the sale of MTI-owned bitcoins that were collected from forex trader FX Choice.

SARS, which accuses the collapsed company’s liquidators of failing to perform their duties ‘as reputable public officials’, reportedly said it reserves the right to adjust its claim if additional bitcoins are found owned by MTI.

In his filing with the Master of High Court, the tax collector claimed that in addition to the late delivery of revenue information, the liquidators failed to report the $10.8 million and $398 million in revenue made during the years 2020 and 2021 respectively.

Of the $55.3 million that SARS requires liquidators, about $20.8 million is for normal income tax, according to the Moneyweb report. To underestimate the revenue, SARS said it wanted $34.5 million from the liquidators.

SARS wants preferred creditor status

Additionally, when presenting evidence on behalf of SARS, Johan Matthews of the Revenue Collector’s Illicit Economy Unit allegedly argued that the revenue collector should be granted preferred creditor status pursuant to insolvency law. If granted, this status prevents liquidators from disbursing recovered funds until the collector’s claims have been paid in full. SARS also said that unless a return is submitted within 40 days of the valuation, MTI’s liquidators will not be able to object or appeal.

The report also quotes the tax collector explaining why he is not waiting for the liquidation process to be completed.

“Taking into account that the taxpayer [MTI] has been finally liquidated and the liquidators are finalizing the administration of the estate including the payment of interim dividends to established creditors, there are reasonable grounds to believe that the taxpayer will not pay the full amount tax and tax collection may be difficult in the future,” SARS reportedly said.

Register your email here to receive a weekly African news update delivered to your inbox:

What are your thoughts on this story? Let us know what you think in the comments section below.

Terence Zimwara

Terence Zimwara is an award-winning journalist, author and writer in Zimbabwe. He has written extensively on the economic problems of some African countries as well as how digital currencies can provide Africans with an escape route.

Image credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. This is not a direct offer or the solicitation of an offer to buy or sell, or a recommendation or endorsement of any product, service or company. does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Esther L. Steinbach