On March 2, 2022, the United States District Court for the Southern District of New York entered final judgment against Defendant Stefan H. Qin, which concluded the SEC's case against Qin, the founder and operator of Virgil Sigma Fund LP, a fraudulent investment fund Qin formed purportedly to engage in digital asset arbitrage trading.

According to the SEC's complaint, filed on December 22, 2020, Qin, through entities he controlled, defrauded investors in the Sigma Fund and an affiliated fund by making material misrepresentations about the funds' investment strategies, assets, performance, and financial condition. At one point, Qin claimed in SEC filings that the funds had assets in excess of $90 million. The SEC's complaint alleged that Qin was actively attempting to misappropriate or improperly divert millions of dollars of investor assets at the time the SEC filed its action, and the SEC obtained an asset freeze on December 23, 2020, followed by a preliminary injunction on January 6, 2021. On January 21, 2021, the Court appointed a receiver over the entity defendants previously controlled by Qin to locate, marshal, and distribute assets belonging to investors in the investment funds.

In a parallel criminal action filed February 4, 2021 by the United States Attorney's Office for the Southern District of New York, Qin pleaded guilty to one count of criminal securities fraud and was sentenced to 7.5 years in prison and ordered to pay $54,793,532 in criminal forfeiture.

In the SEC's action, Qin consented to the entry of the final judgment that permanently enjoins him from violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and orders him to pay disgorgement of $36,352,028 and prejudgment interest of $3,494,791. These amounts are deemed satisfied by the order of forfeiture entered against Qin in the parallel criminal action.

On March 4, 2022, the SEC ordered in settled follow-on administrative proceedings pursuant to Section 203(f) of the Investment Advisers Act of 1940 that Qin is barred from association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization.

The SEC's ongoing investigation is being conducted by Amanda Straub of the Enforcement Division's Cyber Unit in the San Francisco Regional Office. The litigation is being led by Susan LaMarca and Ms. Straub, and the case is being supervised by Kristina Littman and Steven Buchholz of the Cyber Unit. The SEC appreciates the assistance of the United States Attorney's Office for the Southern District of New York and the Department of Homeland Security Investigations.