Stefan He Qin, a 24-year-old Australian citizen, will spend the next 90 month in federal prison. He was convicted of defrauding customers of $90 million. He was also ordered by the courts to forfeit $55 million of the embezzled funds.
The Road to Prison
A press release by the United States Department of Justice stated that Stefan Qin was sentenced to seven years imprisonment for stealing almost $90 million from his clients.
As their New York headquarters were located in New York, VQR and Virgil Sigma, the Australian was responsible for two cryptocurrency investment funds – VQR and VQR. The operational structure of both companies was to collect money, which would later be used in arbitrage trading strategies. They also claimed to be “market neutral,” meaning that their clients are not exposed to the volatility of digital markets.
According to marketing reports, Virgil Sigma had only one month without registering profits – March 2017. Qin maintained a close relationship with his customers and boasted about the success of his investment funds. After Virgil Sigma’s 2017 annual return of 500%, Qin made it to the Wall Street Journal pages.
It all sounded too good for true and Qin’s investors quickly discovered that his strategies were nothing more than a disguised way for him to embezzle client funds and make unauthorised investments.”
The money was used by Qin, a 24-year-old, for his own purposes. He also used it to rent a New York penthouse apartment and to buy food. Qin didn’t stop there. He also used large amounts of investors capital to allocate capital in entities not related to cryptocurrency.
An investigation revealed that Qin was sentenced to seven-and-a-half years in prison and that the court had also ordered the cessation of operations for his investment funds. Qin would also have to return almost $55million of the stolen funds.
You can spend even more time behind bars
Although seven years in federal prison may sound long, it isn’t the longest sentence ever for crimes involving digital assets.
CryptoPotato reported that Roger Nils-Jonas Karlsson, a Swedish resident, was sentenced to 15 years in prison after luring over 3,500 people into a scam Bitcoin investment scheme.
He assured investors that their money, mostly in cryptocurrency, was safe and he used the funds exclusively for his personal enrichment. He bought a luxury condo in Thailand, a resort in Thailand, and even a racehorse.
Karlsson could have served a longer sentence, but he pleaded guilty and was released from prison. The US authorities also ordered Karlsson to forfeit the Thai resort and other properties as part his punishment. He was also required to return all the money he had stolen from his victims.
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