A New York woman sentenced to three years in prison on Tuesday after pleading guilty to defrauding investors, including friends and family members, out of more than $23 million.
Haena Park, who established Phaetra Capital Management LP and Argenta Group LLC, cried as she expressed remorse to U.S. District Judge Ronnie Abrams before being sentenced.
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"I appear before you today ready to accept the consequences of my actions, which have devastated people I care about most in this world," she said.
According to court papers, Park, 41, solicited investments from friends, family and former Harvard University classmates by touting herself as an accomplished foreign-exchange currency trader who had generated annual returns of as high as 48.9 percent.
In fact, Park's trading was consistently unsuccessful, and she lost $19.5 million of the $20 million she traded, mostly in highly leveraged futures and foreign exchange transactions, prosecutors said.
Park generated fictitious account statements that showed investors were making money almost every month, prosecutors said. They said she hid her trading losses by returning $3 million to earlier investors from funds deposited by new investors.
Park, who according to school records graduated from Harvard in 1998 with a psychology degree, was arrested in June 2016 and pleaded guilty to one count of commodities fraud in January.
Park said at Tuesday's hearing that during the six years she carried out her fraud, she was "repeating to myself constantly that I'll turn the losses into gains and pay these people back."
Park's attorney, Julia Gatto, had argued earlier in the hearing that Park was a "fundamentally good person" who was overwhelmed by "a lifetime of family pressure, cultural pressure and internal pressure."
She asked for a sentence of 1-1/2 years of house arrest, noting that Park had serious health conditions and is currently pregnant. However, she acknowledged that such a sentence would be extraordinarily lenient.
"I recognize how crazy it is to ask for house arrest in a case where the losses are over $20 million," Gatto said.
Prosecutors had asked for at least nine years. In imposing a lighter sentence, Abrams said she recognized that there were reasons for leniency, but that Park's conduct nonetheless warranted a "very substantial" sentence.
"I still don't totally understand how you could do that," the judge told Park.