Archegos founder Bill Hwang was sentenced to 18 years
The founder of Archegos Capital Management, a hedge fund, was sentenced to 18 years in prison on Wednesday for fraudulent market and stock manipulation in a scheme that prosecutors said lured investment banks Global losses cost billions of dollars.
Bill Hwang was given a prison term in Manhattan federal court after he told Judge Alvin K. Hellerstein that he felt “really terrible about what happened at Archegos,” referring to the collapse of the fund more than three years ago.
However, the judge did not complete the sentencing hearing and said the trial would continue on Thursday. But he said he had “declared” the prison term he was serving.
Hellerstein estimates that up to nine financial institutions lost more than $9 billion in this fraud.
At Hwang’s trial in July, prosecutors blamed Hwang and his co-conspirators, saying they artificially inflated the value of nearly a dozen stocks before the investments. investor collapsed in March 2021, wiping out $100 billion in market value along with the company he created.
Hwang was convicted in July on 10 counts, but he was acquitted of one count of market manipulation while convicted on six other counts.
Prosecutors said Hwang lied to banks for billions of dollars to grow his New York-based investment firm before its portfolio grows dramatically from $10 billion to $160 billion.
At the start of Hwang’s trial, Assistant U.S. Attorney Alexandra Rothman told the jury that Hwang was already a billionaire when he sought to “become a legend on Wall Street” by participating in a scheme Complexes involved trading derivatives to secretly build extremely large positions in just a few companies.
According to the indictment, unbeknownst to the investing public, Archegos dominated the trading and stock ownership of many companies because it used securities that did not require public disclosure. For example, prosecutors said, Hwang and his company secretly controlled more than 50% of the company’s shares. ViacomCBS.
However, these risky actions have left the company’s portfolio vulnerable to price fluctuations in a small number of stocks.
The indictment said a margin call in late March 2021 wiped out more than $100 billion in market value in just a few days.
