Highlights

  • Wall Street investor Hwang, once worth billions, arrested
  • Hwang and Halligan used leverage to inflate their market positions

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Stock market manipulator faces 380 years in jail

Hwang was freed on $100 million bail while Halligan was let out on bail after on $1 million bond

 

Stock market manipulator faces 380 years in jail

Immigrant, investor and now in jail ...that is the story of Bill Hwang founder of Archegos Capital Management that allegedly scripted a fraud that shook the financial markets across continents.

The owner of a New York-based hedge fund that collapsed when it defaulted on margin calls has been arrested on charges alleging he defrauded leading global investment banks and brokerages.

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The charges unsealed Wednesday in an indictment in Manhattan federal court named Bill Hwang, the founder of Archegos Capital Management, and his former chief financial officer, Patrick Halligan.

"The scheme was historic in scope. We allege that the defendants and their co-conspirators lied to banks to obtain billions of dollars that they then used to inflate the stock price of a number of publicly traded companies. The lies fed the inflation and the inflation fed more lies. Round and round it went. But last year, the music stopped. The bubble burst," said Damian Williams, United States Attorney for the Southern District of New York.

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They face racketeering conspiracy and other charges.

Hwang's attorney said lawyers were extremely disappointed with a prosecution that they believe has absolutely no factual or legal basis.

Halligan's lawyer said he is innocent and will be exonerated.

His downfall came after ViacomCBS Inc., one of Hwang’s big holdings, began to fall. Archegos couldn’t make the margin calls -- setting off panic inside the firm and at the banks that had lent Hwang billions. In the end, Archegos added $900 million in a day.

With his sweptback salt-and-pepper hair and donning a face mask, green turtleneck and tan pants, Hwang appeared in court Wednesday afternoon to enter his not guilty plea. He agreed to pay $5 million in cash and pledged two properties to secure a $100 million bond, while Halligan agreed to $1 million bail. Both men agreed to restrict their travel.

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