NEW YORK (Washington Insider Magazine) – Federal prosecution in New York brought criminal accusations against the founder and chief financial officer of a capital investment business for alleged “deceptive conduct” and “manipulative trading” that resulted in a multibillion-dollar scam on Wednesday.
According to ABC NEWS, Bill Hwang, the owner of Archegos Capital Management, with Patrick Halligan, the company’s CFO, have been accused of wire fraud, racketeering conspiracy, and securities fraud.
“We allege that these defendants and their co-conspirators lied to banks in order to obtain billions of dollars, which they then used to inflate the stock prices of a number of publicly traded companies,” Manhattan US Attorney Damian Williams said.
Halligan and Hwang allegedly tainted the activities and operations of the family office recognised as Archegos and utilized it as a tool for stock manipulation and fraud, according to the indictment. High-net-worth families and individuals are served by family offices.
Hwang’s lawyer, Lawrence Lustberg, voiced his concerns at the charges, calling them “extremely disappointing.”
Halligan’s attorney, Mary Mulligan, claimed her client is “innocent and will be exonerated” in a statement.
Prosecution said that the ramifications were far-reaching. A number of firms’ stock values were manipulated, employees’ investments were gambled, and many institutions were left with billions in damages. According to the indictment, UBS alone lost $861 million.
The criminal allegations came after Archegos’ stunning downfall in March 2021, when the company lost billions in a matter of days. Hwang, according to investigators, traded in a manner that concealed the real magnitude of his holdings from the remainder of the investing community.
In one case, according to court documents, Archego owned more than half of Viacom’s openly traded stock, and no one else, including Viacom executives, knew about it. This was reportedly accomplished by utilizing a variety of banking and brokerage firms to guarantee that no single party was aware of the deals’ extent.
According to investigators, the suspected illicit activity increased Archegos’ portfolio – Hwang’s personal wealth – from $1.5 billion to $35 billion in a year.
During a court hearing on Wednesday, Hwang’s bail was set at $100 million. He also had to certify that he had misplaced his passport, while his wife was required to surrender hers. Halligan’s bail was set at $1 million.
Both are likely to be released today, with travel restrictions imposed on them.
