Wed. May 22nd, 2024

24-Year-Old Australian Crypto Fraudster Sentenced To Prison for Stealing $90 Million Through A Ponzi Scheme

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An Australian, Stefan Qin has been sentenced to seven and a half years in prison for conducting two illegal cryptocurrency funds and tricked investors to invest in the projects reading to millions of Dollars.

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The 24 years old will be spending the next 7 years in federal prison for swindling his customers for a total of $90 million. The court has also charged that he relinquishes $55 million from the embezzled money.

The young man honestly used the money for personal purposes, such as services, food, and renting a luxurious penthouse apartment in New York. Qin did not stop there, he also used a substantial portion of the investors’ capital to make allocations in other entities that are not related to cryptocurrencies at all.

The investigation revealed that he received a prison sentence of seven and a half years and the court also ordered his investment funds to cease operations. Apart from this jail time, Qin would have to restore almost $55 million of the stolen funds.

The Australian was in charge of two cryptocurrency investment funds – Virgil Sigma and VQR as their headquarters were in New York. Both companies’ operational structure was to collect money from investors, which later to employ in arbitrage trading strategies. What’s more, they promoted themselves as “market-neutral,” meaning that the volatility of the digital market does not expose their clients to any risks.

Per the marketing reports, Virgil Sigma has had only one month where it did not register profits in March 2017. Stefan was also in constant relation with his customers, often bragging about the success of his investment funds.

Stefan Qin even reached the Wall Street Journal pages after Virgil Sigma had yielded an annual return of 500% in 2017. However, it all sounded too good to be true, and “Qin’s investors soon discovered that his strategies weren’t much more than a disguised means for him to steal and make unauthorized investments with client funds.”

According to a press release from the United States Department of Justice, In December 2020, faced with redemption requests from the Virgil Sigma fund that he could not meet, Stefan demanded that the Head Trader at VQR wind down all trading positions at VQR and transfer a portion of the funds to him so that He could use that money to pay off these redemptions to Virgil Sigma investors. 

Though the forenamed court decision of more than seven years in federal prison might sound like a long time, it is not the largest ever given for crimes Involving digital assets or the first time it is to happen.

In July 202, a Swedish resident named Roger Nils-Jonas Karlsson was sent to prison for 15 years after luring more than 3,500 people into a fraudulent Bitcoin investment scheme.

About The Author

By Queen Helen

Data Scientist, Tech Enthusiast and a Crypto Lover

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