Stefan Qin, the owner of two cryptocurrency hedge funds in New York, Stefan Qin, has been sentenced to 7.5 years in prison and three years of supervised release, This is just as he has been ordered to forfeit about $55 million, the U.S. Department of Justice (DOJ) stated.
The Department of Justice (DOJ) said that he “engaged in a scheme to steal assets” from his hedge funds and defraud investors.
Qin, a 24-year-old Australian national, founded the Virgil Sigma Fund and the VQR Multistrategy Fund, which claimed to have over $100 million dollars in investments. He pleaded guilty to one count of securities fraud on Feb. 4 after the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against him in December last year.
According to the DOJ, Qin was sentenced Wednesday to 90 months in prison.
The Department of Justice explained that between 2017 and 2020, Qin owned and controlled the two cryptocurrency investment funds. “Until recently, Virgil Sigma purported to have over $90 million under management from dozens of investors, including many in the United States,” the Department said. “Until recently, VQR had at least approximately $24 million under management from investors.”
The DOJ detailed:
Since 2017, Qin has engaged in a scheme to steal assets from Virgil Sigma and defraud its investors. Rather than investing the fund’s assets in a cryptocurrency arbitrage trading strategy as advertised, Qin embezzled investor capital from Virgil Sigma and used the funds for purposes other than the purported arbitrage trading strategy.
Qin also attempted to steal assets from VQR as Bitcoin.com News previously reported. The DOJ explained that Qin’s two cryptocurrency funds “have ceased operations and the liquidation and distribution of assets is being handled by a court-appointed receiver in the matter of S.E.C. v. Qin, 20 Civ. 10849,” adding:
Qin, 24, was also sentenced to three years of supervised release, and ordered to forfeit $54,793,532.