By Jonathan Stempel
NEW YORK (Reuters) – Invoice Hwang, the founding father of Archegos Capital Administration, ought to spend 21 years in jail for operating a market manipulation scheme that worn out his $36 billion agency and value its lenders greater than $10 billion, federal prosecutors mentioned on Friday.
Hwang, 60, faces a scheduled Nov. 20 sentencing in Manhattan federal courtroom after being convicted in July on 10 prison expenses together with securities and wire fraud and racketeering conspiracy.
Prosecutors accused Hwang of mendacity to banks about Archegos’ portfolio so he might borrow cash aggressively and make concentrated bets on media and know-how shares reminiscent of ViacomCBS (NASDAQ:), by so-called complete return swaps.
Hwang amassed $160 billion of publicity to shares, however was unable to fulfill margin calls as costs started falling.
This led to Archegos’ demise in March 2021 and triggered large losses for banks reminiscent of Credit score Suisse, now a part of UBS, and Nomura Holdings (NYSE:) as varied 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 attorneys mentioned he ought to obtain no jail time.
The attorneys mentioned prosecutors didn’t and can’t show Hwang’s alleged lies triggered losses for banks. In addition they mentioned Hwang’s age, heart problems, philanthropy and low danger of recidivism weighed in opposition to placing him behind bars.
Hwang’s co-defendant, former Archegos Chief Monetary Officer Patrick Halligan, was convicted on the identical trial on three prison expenses. His sentencing is scheduled for Jan. 27, 2025.
