The hedge founder was sentenced to 90 months by Valerie Caproni, a US Department of Justice district judge
Crypto hedge fund founder sentenced to over 7 years in prison. Source: shutterstock.com
Stefan He Qin will serve over 7 years jail term for swindling investors $54 million, according to the US Department of Justice.
Between 2017- 2020, the Australian owned and run operations on two cryptocurrencies investment funds, Virgil Sigma and VQR.
Stefan claimed to use Virgil Sigma funds in digital currencies arbitrage strategies. However, since 2017, he had embezzled the investment funds to cater for personal expenses including food, private investments and rent.
Stefan then created bogus tax records and false account statements to avoid suspicion. He claimed the firm had gained profits every month apart from March 2017 with $90 million in assets. False information regarding the location, value and status of the capital was relayed to the investors. To pay Sigma’s investors, he resulted in stealing VQR assets.
In December 2020, the digital currency founder instructed VQR’s head trader to transfer the funds to his accounts, a move that resulted in investor capital losses. He pleaded guilty to a securities fraud charge in February 2021. He has now been instructed to forfeit over $54 to get a supervised release of three years.
This comes as digital currency scams increase. The rise in scams can be blamed on gaps in regulatory protection. Since October 2020, consumer losses amounting to over $80 million in digital currencies were reported.
We’ve reported that ING to shut down Yolt’s smart money app.
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