NEW HAVEN, Conn. – A former New York University student whose Greenwich hedge fund cost investors millions of dollars pleaded guilty to one count of bank fraud Tuesday and said he planned to plead guilty to one count of wire fraud.
The plea agreement does not recommend a sentence. Hakan Yalincak faces up to 50 years in prison on the two counts.
Prosecutors said Yalincak, 22, lured investors to his fund by portraying himself as the scion of a wealthy Turkish family. The fund didn't exist, Yalincak's attorney acknowledges, and investors lost more than $7 million.
Defense attorney Bernard Grossberg has said Yalincak was a pawn in the scheme.
The bank fraud charge accuses Yalincak of passing $43 million worth of bad checks. Yalincak was so adept at bank fraud and check counterfeiting, prosecutors said, that all he needed to pose a financial danger to the community was a computer and a telephone.
Asked Tuesday how he pleaded, he replied: "Guilty, your honor. I'm sorry."
A judge was scheduled to deal with the wire fraud charge, which covered the hedge fund scam, later Tuesday.
The deal does not cover Yalincak's mother, Ayferafet, who is still scheduled for trial next month.
Prosecutors said the Yalincaks spent the money on luxuries including a Porsche. About $1.25 million from the fund was donated to NYU to keep up the family's wealthy appearance, prosecutors said.
NYU has said it will return the donation if a court determines that the money came from an illegitimate source.