SEC orders cryptocurrency hedge fund Virgil Capital to freeze assets
The U.S. Securities and Exchange Commission (SEC) announced on the 28th (local time) that an emergency relief order, such as an asset freeze applied to the cryptocurrency hedge fund, Virgil Capital, has been passed.
On the 24th, the SEC accused Stephen Chin Virgil Capital founder of securities fraud and filed an emergency freeze order for a $25 million cryptocurrency fund.
The founder is accused of failing to repay the $3.5 million investment and attempting to repay the Chinese moneylenders by withdrawing $1.7 million of the investment.
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According to the SEC prosecution document, Virgil Capital has committed to investing the funds of the Virgil Sigma Fund in cryptocurrency through its own algorithm, but in reality it has been used for personal purposes or invested in other high-risk investments.
Investors are known to have not received any proceeds since July.
Stefan Chin has argued that the funds have been transferred to the other fund he manages,’VQR Multi-Strategy Fund’, to investors who ask for proceeds. However, the SEC said, “There has been no such transfer of funds and the repayment issue remains unresolved.”
The SEC also alleged that the founder was misappropriating the assets of the VQR fund and was working to obtain new investments in the Sigma Fund.
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