Hakan Yalincak’s story is the stuff of a Balzac novel.

A year ago Saturday, the young, studious New York University senior was arrested at his home in Pound Ridge, N.Y., a week before graduation. Mr. Yalincak’s alleged crime was issuing $43 million in fraudulent checks, and he was later charged with taking $7.4 million from several businessmen who thought they were investing in a hedge fund and then spending the money on luxury items – all at the age of 21.

As the case unfolded, Mr. Yalincak, who was born in Turkey, came to resemble more a character out of his favorite book – the student-turned-schemer Eugene de Rastignac in Balzac’s “Le Pere Goriot” – than the shy student his peers and professors thought they knew.

To make matters worse, his family donated $1.25 million of the money prosecutors say was stolen to NYU to build a state-of-the-art classroom, with the promise that another $19.75 million was soon to come. That money was earmarked to help buy a building for the school’s general studies program as well as to help fund a professorship in Ottoman studies. In court documents, prosecutors allege the family used a flier announcing their gift as a kind of unofficial credit record to convince well-known businessmen to invest in Mr. Yalincak’s little-known fund.

These days, the new classroom on West 4th Street is marked by what some on campus call a reminder of a reneged promise and a classic dupe. In large silver lettering, the polished wood exterior displays the words: “The Yalincak Family Foundation Lecture Hall.”

“Every time I walk by it I get a good laugh out of it,” a professor in the school’s General Studies Program, Ward Regan, said. “People were pretty psyched about the new building. When it came down as a complete fraud, we were disappointed.”

University administrators heralded the donation at the time as a “unique gift” from a student who had the picture-perfect NYU experience: “stimulating courses,” “diverse classmates,” and “exceptional faculty,” according to an NYU newsletter. At a major university banquet, the Yalincak family posed for photographs beside the university’s president, John Sexton, and other top administrators in tuxedoes.

Beneath the veneer of philanthropy, Mr. Yalincak was allegedly forging checks and manipulating investors. With the proceeds, he purchased large life insurance policies, a high-end pair of glasses, jewelry from Tiffany’s, and a Porsche, according to bank documents.

On Monday, the university was able to fend off paying back $1 million of the Yalincak donation to the hedge fund’s managers in U.S. Bankruptcy Court in the Southern District of New York. The mangers are trying to settle civil cases with the allegedly defrauded investors, who want their money back. Prosecutors allege that Mr. Yalincak doctored earnings statements that were sent to the investors to keep them in the dark that he was spending their money. A spokesman, John Beckman, said the university was waiting for an “authoritative judgment” before it makes the final payback. Mr. Yalincak’s criminal case is in the pre-trial stage.

At his arraignment last year, Mr. Yalincak sobbed, pleading with the judge to be let free because he was supposed to graduate. School officials later said he didn’t have enough credits to graduate and was never added to the list of matriculating seniors. At his bail hearing, the judge called him a flight risk and ordered him incarcerated without bail. He has been at the Donald Wyatt Detention Center ever since.

Two weeks ago, Mr. Yalincak appealed that ruling, asking to be allowed to stay at a church safe house in Connecticut during the trial period. It isn’t the first time the family has sought help from a church.

A pastor in Indianapolis, Donald Johnson, said Hakan Yalincak’s mother, Ayferafet Yalincak, convinced him to let her borrow several thousand dollars and to help her set up a medical practice in the mid-1990s. When law enforcement officials discovered she had a false medical license and was practicing fraudulent medicine, the family fled with the pastor’s money, he said. Mrs. Yalincak spent two years in prison after she was caught as a fugitive in Connecticut.

“If we believe God is calling us to do this and they take advantage of us, that’s between them and God,” the church elder, Frank Palmer, said. “But we don’t give out money.”

By the time Mr. Yalincak reached NYU, he was brimming with idealism and ambition, like the character Rastignac. In high school, he won awards for his charity fund-raising for victims of an earthquake in Turkey. His former principal, Christopher Clouet, wrote in a letter attached to Mr. Yalincak’s motion to stay at the church’s safe house: “Persistence is a word I associate with Hakan. This quality has served him well.”

The dean of the General Studies Program, Fred Schwarzbach, said Mr. Yalincak “came across as a very typical NYU undergraduate: bright, engaged, energetic.” There was nothing, he said, to betray the Machiavellian underside prosecutors said he was concealing.

Mr. Beckman said the Yalincak incident hasn’t led to an overhaul of the university’s donor background checks, but he said administrators will be more cautious in the future.

“We were a recipient of money, not a loser of money,” he said. “But I think its fair to say that everybody’s antenna will be raised going forward.”

Court documents and press reports say Mr. Yalincak was highly concerned with status, describing his family as Turkish royalty and using the pseudonym “Sahenk,” the name of a famous Turkish billionaire. As with Rastignac, that search for status came to a close when the police moved in.