By Jonathan Stempel
NEW YORK (Reuters) – Invoice Hwang, the founding father of Archegos Capital Administration, ought to spend 21 years in jail for working a market manipulation scheme that worn out his $36 billion agency and value its lenders greater than $10 billion, federal prosecutors stated on Friday.
Hwang, 60, faces a scheduled Nov. 20 sentencing in Manhattan federal courtroom after being convicted in July on 10 felony costs together with securities and wire fraud and racketeering conspiracy.
Prosecutors accused Hwang of mendacity to banks about Archegos’ portfolio so he may borrow cash aggressively and make concentrated bets on media and expertise shares corresponding to ViacomCBS (NASDAQ:), by so-called whole return swaps.
Hwang amassed $160 billion of publicity to shares, however was unable to satisfy margin calls as costs started falling.
This led to Archegos’ demise in March 2021 and precipitated massive losses for banks corresponding to Credit score Suisse, now a part of UBS, and Nomura Holdings (NYSE:) as numerous banks unloaded shares backing Hwang’s swaps.
Hwang didn’t testify at his two-month trial. He’s anticipated to attraction his conviction.
On Nov. 8, Hwang’s legal professionals stated he ought to obtain no jail time.
The legal professionals stated prosecutors didn’t and can’t show Hwang’s alleged lies precipitated losses for banks. In addition they stated Hwang’s age, heart problems, philanthropy and low danger of recidivism weighed towards placing him behind bars.
Hwang’s co-defendant, former Archegos Chief Monetary Officer Patrick Halligan, was convicted on the similar trial on three felony costs. His sentencing is scheduled for Jan. 27, 2025.
