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Stefan He Qin, a cryptocurrency hedge fund manager based in New York, was sentenced to seven and a half years in prison on September 15 for fraud.
Judge Valerie E. Caproni of the US District Court also ordered the confiscation of $ 54,793,532.
The 24-year-old Hata was accused of misreporting the return on his $ 90 million fund and embezzling investor funds to pay for his extravagant living expenses.
Qin, a Chinese-Australian and self-proclaimed math genius, has pleaded guilty to securities fraud.
At the age of 19, he founded two crypto investment funds, Virgil Sigma and VQR, in New York City. The two funds claimed a total investment of $ 100 million, and many investors came from the United States. At the age of 20, he starred in China’s national network CCTV for “success.”
Audrey Strauss, United States Attorney for the Southern District of New York, quickly discovered that Qin’s investors were just a fake investment strategy and used their clients’ funds for unauthorized investments, such as the Ponzi scheme. Said that it can.
“When faced with a redemption request he couldn’t meet, Qin doubled his plan by trying to plunder VQR to meet the demands of the victim’s investors,” Strauss said. Said.
“Qin’s brave and widespread plan left his embarrassed investor in a hurry for more than $ 54 million, and he has now been handed a reasonably long sentence of more than seven years in federal prison.” She said.
The prosecution said Qin has not invested the fund’s assets in the advertised arbitrage strategy since 2017.
Instead, he used the investor’s money from Virgil Sigma to pay for personal expenses such as food, services and rent.According to the February report by BloombergThe monthly rent for the apartment where Qin lived was $ 23,000.
In 2020, Qin was unable to meet the redemption request from Virgil Sigma investors. To prevent exposure, he sought to steal investor capital from the second company, VQR, by closing all investor trading positions.
Qin was exposed before successfully tampering with VQR investors’ funds. But he successfully deceived more than 100 investors in their investment.
The prosecution said Mr. Hata frequently lied to investors about the value, location and circumstances of their investment capital and provided them with forged tax documents.
The Virgil Sigma Fund and VQR have been shut down and the liquidation and distribution of assets will be taken over by the entity appointed by the court.
Qin was also sentenced to release under surveillance for three years.
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Alex Wu is a US-based writer of The Epoch Times, focusing on Chinese society, Chinese culture, human rights and international affairs.
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