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David Hu, the former managing partner of International Investment Group (IIG) was sentenced to 12 years in prison for his role in defrauding investors of more than $120 million in a Ponzi-like scheme. In January 2021, Hu pleaded guilty to investment adviser fraud, securities fraud, and wire fraud offenses. He admitted to operating a Ponzi-like scheme to steal money from IIG  investment advisory fund clients and investors for ten years. U.S. District Judge Alvin Hellerstein issued the sentence against Hu on Monday. In addition to the 12 years of prison time, the judge also ordered Hu to serve three years of supervised release. His sentence will be formally enforced following the conclusion of the forfeiture and restitution proceeding in the case. According to the U.S. Attorney's Office for the Southern District of New York, Hu and his co-conspirator Martin Silver established IIG in 1994. They conspired to defraud IIG investors from approximately 2017 to 2019. Hu and Silver's Ponzi-like scheme involved overvaluing distressed loans held by IIG funds, falsifying documents to create a series of fake loans that were classified as performing, selling overvalued and fake loans to a collateralized loan obligation trust, and new private funds established and advised by IIG, and using the proceeds from those fraudulent sales to generate liquidity required to pay off earlier investors. In April 2021, Silver also pleaded guilty to investment adviser fraud, securities fraud, and wire fraud offenses. He is awaiting sentencing. In a statement, U.S. Attorney Damian Williams said, “David Hu shirked his fiduciary responsibilities and defrauded IIG funds and investors for more than a decade.  Hu’s lies caused millions of dollars of losses.  Hu mismarked millions of dollars of loan assets, falsified paperwork to create fake loans, sold overvalued and fake loans, used the proceeds from those sales to pay off earlier investors, and falsified paperwork to deceive auditors and avoid scrutiny.  Today’s sentence sends the message that brazen fraud does not pay and will be appropriately punished.” In July 2020, the Securities and Exchange Commission (SEC) also filed fraud charges against Hu. The securities regulator revoked IIG's registration as an investment adviser in November 2019. Have a story you want USA Herald to cover? Submit a tip here and if we think it’s newsworthy, we’ll follow up on it. Want to contribute a story? We also accept article submissions – check out our writer’s guidelines here.