Three Ponzi kings in South Africa – one dead, one in jail, and one arrested
Over the past few years, South Africa has experienced the rise and fall of three large Ponzi schemes—MTI, BHI Trust, and the Diamond Scheme—that saw investors lose millions.
Ponzi schemes are fraudulent investment schemes that promise high returns with minimal risk. Instead of investing the money, the scammer focuses on recruiting more investors.
These schemes are often described as “robbing Peter to pay Paul” as they lure new investors with the money they took from earlier investors.
Therefore, all Ponzi schemes are inherently destined to collapse, as they will eventually run out of new investors to lure into the scheme.
The South African Banking Risk Information Centre explains that if there are more existing investors than new investors, the scheme collapses, and all money invested is lost.
This means people expecting to make a good return on their investment not only get nothing but also stand to lose most, if not all, of the money they initially invested.
Over the years, South Africa has seen its fair share of Ponzi schemes, one of the most notorious being the so-called ‘Kubus scheme’, orchestrated by Adriaan Nieuwoudt in the 1980s.
The scheme involved participants cultivating milk yeast cultures, which they sold back to Nieuwoudt for a profit. Participants were also required to recruit new members to ensure the scheme’s sustainability.
The Kubus scheme gained widespread popularity and made headlines across the country. However, it was eventually deemed an illegal lottery.
Despite the lessons learned from the Kubus scheme, Ponzi schemes continue to plague South Africa, costing unsuspecting individuals millions of rands.
As technology has advanced and intangible assets like cryptocurrency have risen in popularity, Ponzi schemes have become increasingly common.
In addition, despite regular warnings from the Financial Sector Conduct Authority (FSCA) about Ponzi schemes, the lure of making money quickly is too much for many people to resist.
Over the past few years, South Africa has seen a rise in Ponzi schemes, but most have been on a far smaller scale and shut down relatively quickly.
However, three schemes – MTI, BHI Trust, and the Diamond Scheme – managed to break through and lure thousands of investors, resulting in significant losses.
Below is an overview of these three schemes, the people involved, and where they are now.
MTI – Johann Steynberg

Mirror Trading International (MTI), led by Johann Steynberg, was one of South Africa’s largest pyramid schemes.
It lured investors with promises of significant monthly returns on Bitcoin investments. Operating as a Ponzi and multi-level marketing scheme, it encouraged participants to recruit new members in exchange for bonuses, which helped it grow a global following.
The scheme began unravelling after financial regulators raised alarms and tech activists exposed weaknesses in MTI’s website.
In September 2020, a group called Anonymous ZA exploited vulnerabilities in the website, revealing the company’s fraudulent structure.
By December 2020, facing intense scrutiny, Steynberg fled to Brazil, leaving many investors stranded.
Speculation swirled about his whereabouts and whether he had absconded with investor funds.
Brazilian authorities eventually located and arrested him for using a false identity. While initially convicted, Steynberg lived relatively comfortably under house arrest, reportedly leading a lavish lifestyle, including travelling by helicopter.
Court documents later revealed he had purchased properties under fake names and had ties to the illegal drug trade.
However, in a dramatic turn of events, Steynberg reportedly died while under house arrest, with medical reports citing acute respiratory failure due to a massive pulmonary embolism.
MyBroadband reported that Steynberg’s lawyer, Thales Jayme, said the MTI mastermind had been facing a series of escalating mental health problems, including severe anxiety that may have led to panic attacks.
The fallout from MTI has been widespread and severe, both for investors and the broader financial regulatory environment in South Africa and beyond.
MTI left investors with estimated losses of around 23,000 Bitcoin, worth billions of rands.
Thousands of individuals globally were affected, and many investors are still trying to recover their funds through legal processes. Liquidators are working to reclaim assets, but recovery has been slow and uncertain, with many investors left in limbo.
MTI’s reach and impact were so vast that its collapse led to intensified scrutiny of cryptocurrency schemes in South Africa.
The FSCA issued several warnings about MTI, and the aftermath has prompted stronger efforts to regulate crypto assets in the country.
The FSCA and other international agencies are now focusing on closing regulatory gaps to prevent future Ponzi schemes from flourishing under the guise of cryptocurrency investments.
BHI Trust – Craig Warriner

Craig Warriner orchestrated a massive fraud through the BHI Trust, deceiving South African investors in a scheme reminiscent of Bernie Madoff’s infamous Ponzi operation.
Warriner marketed himself to wealthy clients as an expert day trader, specializing in BHP Billiton and Anglo American stocks.
He claimed he could predict their price movements so accurately that he was able to generate consistent daily profits, which were immediately reinvested.
Warriner, a St Stithians alumnus, leveraged his elite school connections to attract fellow alumni and their families into the scheme.
The trust collapsed in late 2023, after which Warriner surrendered to the authorities and appeared in the Palm Ridge Magistrates Court, representing himself.
Many victims did not report their losses due to mistrust of the liquidators or concerns about returning previous payouts.
Warriner’s operation was shrouded in secrecy, and little public information was available about him or the BHI Trust.
Although some investors believed their funds were held in regulated accounts, the FSCA clarified that neither Warriner nor BHI Trust were licensed to provide financial services.
Following an investigation, the FSCA banned Warriner from offering financial services, and in May 2024, he was sentenced to 25 years in prison after pleading guilty to 207 charges of fraud, corruption, and violating financial services regulations.
In October this year, two people who were also behind the BHI Trust investment scheme – Michael Haldane and Mauro Forlin – were debarred for 30 years from providing financial services.
This scheme left hundreds of investors financially devastated, with initial reports estimating that at least 206 individuals were affected.
However, the true scale of the fraud likely involved over 800 victims, with total losses potentially exceeding R3 billion.
Liquidators are still trying to recover assets from the BHI Trust to compensate victims.
However, the complexity of tracing funds, especially over 15 years, and the likelihood that some of Warriner’s payouts will need to be returned by investors who unknowingly benefited from the scheme makes the recovery process challenging and protracted.
Diamond scheme – Louis Liebenberg

Louis Liebenberg is allegedly at the centre of a high-profile diamond investment scandal involving fraud and money laundering.
His company, Tariomix, operated under the name Forever Diamonds and Gold, soliciting investments from thousands of people under the pretence of purchasing diamonds.
Tariomix, which Liebenberg founded, bought and sold polished diamonds and financed diamond transactions.
However, it has been revealed that the venture was likely a Ponzi scheme, scamming investors out of over R4 billion since 2019.
In 2023, Tariomix was provisionally liquidated following an urgent application by two of its investors.
Meanwhile, Liebenberg’s accounts were frozen after a digital payment platform detected suspicious activities tied to the scheme, although some funds were released after a court challenge.
Liebenberg, who has faced multiple lawsuits, including defamation claims and investigations, was recently arrested along with his wife, Dezzi, and several other accomplices following a multi-year investigation by the Hawks.
News24 reported on Thursday, 24 October, that Liebenberg will remain behind bars for now after he abandoned his bail bid during his first appearance in the Bronkhorstspruit Magistrate’s Court.
The publication reported that Liebenberg’s legal representative told the court they would not be applying for bail at this stage and would inform the state at a later stage if they changed their minds.
His next court appearance is scheduled for 31 October 2024.
Liebenberg has been notorious not only for his alleged involvement in the diamond investment scam but also for his close relationship with former President Jacob Zuma.
He reportedly contributed financially to Zuma’s legal battles, further tainting his reputation.
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