Photographer: Akos Stiller / Bloomberg
Photographer: Akos Stiller / Bloomberg
A 24-year-old founder of two New York-based cryptocurrency hedge funds with more than $ 100 million in investments on Thursday pleaded guilty to security fraud.
Stefan He Qin is accused of fraudulent investors by claiming that he used a trading algorithm to take advantage of price differences for a number of cryptocurrencies, federal prosecutors said in an email statement.
Qin stole investor money from its Virgil Sigma Fund MP and attempted to invest in its VQR Multistrategy Fund MP to repay investors in the first fund. He acknowledgeAccording to the statement, he tried to steal from yet another fund he controlled to cover VQR funds’ redemption claims.
“The entire house of cards has been unveiled, and Qin is now awaiting sentencing for his stupid theft,” Audrey Strauss, acting U.S. attorney for Manhattan, said in the statement.
Qin’s fraud is based on misconceptions about its investment strategy to attract millions of investor dollars in fraudulent cryptocurrency ventures, prosecutors said. Qin, an Australian citizen, embezzled almost all the capital from the Virgil Sigma fund to pay, among other things, personal expenses for a penthouse. He faces up to 20 years in prison.
“Mr Qin has accepted full responsibility for his actions and is committed to doing what he can to rectify them,” his lawyers, Sean Hecker and Shawn Crowley, said in a statement.
The US Securities and Exchange Commission has filed a parallel civil case against Qin in December.
– Assisted by Olga Kharif
(Updates with comments by Qin’s lawyers)