A Canberra-born crypto crook who swindled $123 million from investors has given a tell-all interview about why he did it before entering prison.
An Aussie crypto fraudster, who stole $123 million from investors and spent most of the money on sugar babies, has given a tell-all interview claiming “greed”, bullying and an ex-girlfriend caused his offending.
Stefan Qin gave the interview before he was due to start a 7.5-year prison sentence in New York, after he was found guilty of deliberately misleading Australian and US investors and falsifying account statements while running his crypto outfit Virgil Sigma Fund.
In the video published on YouTube, he shows the camera crew around his three bedroom New York apartment, which he rents for $US24,5000 ($A34,000) a month, that includes “Instagrammable” views from the master bathroom.
The Canberra-born man outlines the two factors that contributed to his downfall.
“First of all I had a betrayal from my co-founders, it wasn’t so much a betrayal as in a split of opinion, and the second thing is I lost my virginity in 2017, which was huge to this girl, and I was madly in love with her and then she cheated on me with some guy who was richer than I was,” he said.
“You have this beautiful girl that you think you are going to spend the rest of your life with and you’re not rich enough for her.
“But long story short because my co-founders left now I was the one who was 100 per cent in control of the entire company and if you’re 21 years old and you’re the only one with access to all these bank accounts that’s a recipe for disaster and that’s essentially what happened.”
Heartbroken, Mr Qin said he became “addicted” to sugar babies and that’s where most of the investors’ money went.
“Honestly, this is so f**ked up to say but the only reason I had a three-bedroom place was because I had three sugar babies at any given point of time … and that’s my biggest regret because that’s what I spent the money on,” he revealed.
“Because if it was material stuff, if it was stuff like cars … at least the (US Securities and Exchange Commission) can take that and sell that. How can they get money back from sugar babies?”
He said during the investigation the US regulator came to his apartment to take away all the expensive items he owed, which included a collection of Magic: The Gathering cards that he estimated were worth “a couple hundred thousand dollars”.
“By the time they had come here, I’d already known that none of this was mine,” he added.
“The difference between this and the money in the bank accounts is it’s much more real seeing people coming and taking stuff, versus freezing your bank accounts.”
Mr Qin got into the crypto game after dropping out of the University of NSW in 2016 and moving to China.
There he worked for a crypto exchange, where investors took advantage of bitcoin price differences on various crypto exchanges. He then took the software he had created to set up his own company, Virgil Sigma Fund.
In the video, which is titled The 24-year-old Crypto Crook Who Ran a $140m Ponzi scheme, Mr Qin recounts the severe bullying and harassment he experienced from his Canberra school mates, which he said led to “extreme depression and suicidal tendencies” by the time he hit year seven and eight.
He said this experience further drove him to do the wrong thing.
“There is this huge insecurity in the Asian community to be as successful as possible at all costs. It’s not even about the money, it’s just about looking good and later on that showed up in the worst way possible,” he said.
“I would just keep raising money and keep doing my thing and in the back of my mind I would always be thinking ‘F**k you I’m more successful than you now come work for me now’ to the bullies in my head.”
While the fund had $US2 million invested, when the Wall Street Journal published a story calling him the “bitcoin wunderkind” in 2018, the money flooded in with Mr Qin saying he raised an extra $US65 million in just the space of a month.
However, he had no “real way to deploy it”.
He was also interviewed by CNBC at the time where he suggested viewers look at Western and Eastern markets for opportunities.
“A good hedge fund manager would never give away their competitive opportunities like that,” he said.
“The reason I was OK with giving that up was because I wasn’t actually trading them, even though I said I was. It was all fake.”
Mr Qin then lied to investors about how the fund was performing and was later charged with one count of securities fraud, but admits things could have been much worse “given the magnitude and scale of the fraud”.
“In fact if they knew the actual amount was the $US100 plus million amount, it would been a different story, as $100 plus million is very different to $US90 million ($A123 million),” he added.
But he believes the fund didn’t collapse due to “angry investors” but came down to him playing “video games all day”.
He said this resulted in him “ghosting” employees and eventually his senior executives banded together to become whistleblowers, revealing he was shifting money between accounts to cover up underperformance in the fund.
When the investigation was announced into Mr Qin’s fund, he was in a hotel room in Korea with a sugar baby and at the “lowest point of his life”.
He asked the girl to stay an extra day but she required more money and at this point he realised this “wasn’t a real relationship” and decided to surrender himself within two days.
“I actually had 200 bitcoins in wallet and at the time in December 2020 it was about $US4 million or $US5 million. I could have run away, got a plastic surgery face, got a new passport and lived off 200 bitcoins for a good amount of time,” he revealed.
“Because that’s a lot of money for a lot of people. I probably would have ended up wasting away that 200 bitcoin on stupid things, like learning how to live a normal life more like an adult or trying to impress people like girls … in the next five to six years, so it would have been useless.”
While he “regrets” his actions, Mr Qin admits he wouldn’t have stopped unless the US regulators had stepped in but said what he did was “inexcusable”.
“I’m just saying its none of the investors fault and I choose to go down that route but I felt immense pressure to inflate the returns and just lie because I needed to match the expectations that they had this image in their head of this wunderkid that could make them a lot of money,” he said while sitting at a table in his apartment.
“And unless I met that image I was a failure and maybe I would go back to being bullied again and go back to people making fun of me and never having friends again.
“No one grows up and thinks to themselves, hey I want to steal $US100 million.”
While his family disowned him for a bit, Mr Qin said they stepped back in to pay for his legal bills, but added he owes a big debt to society.
Before facing his punishment, he revealed he had taken up boxing six months ago to “learn how to defend himself in prison” adding that American jails are pretty “scary”.
Now in prison for his seven year sentence, which includes three years of supervised release, Mr Qin said he plans to write a book and later run as a politician in Australia.
Originally published as Crypto fraudster Stefan Qin reveals why he stole $123m
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