By Nupur Anand
NEW YORK (Reuters) – Sung Kook “Invoice” Hwang, founding father of the $36 billion non-public funding agency Archegos Capital Administration which collapsed spectacularly in 2021, arrived in court docket on Wednesday for the beginning of his prison trial.
Here’s a timeline of the fund’s blow up – one of many greatest in years – which left world banks with $10 billion in losses:
1996-2001: Hwang, who moved to america as a baby from South Korea, works on the late billionaire Julian Robertson’s pioneering hedge fund Tiger Administration, the place he hones his stock-picking expertise.
2001: Hwang launches his personal hedge fund, Tiger Asia Administration. The agency was began with seed cash from Robertson, making him a part of an elite group of the billionaire’s protégés dubbed the Tiger Cubs.
2012: Regulatory points in Hong Kong and america lead Tiger Asia Administration to close down in 2012. Hwang pleads responsible to wire fraud referring to unlawful buying and selling of Chinese language financial institution shares and individually pays $44 million to U.S. authorities to settle insider buying and selling expenses.
2013: Hwang turns Tiger Asia right into a household workplace, renaming it Archegos Capital Administration in early 2013.
March 2020: Working from his Manhattan residence as COVID-19 sweeps New York, Hwang begins amassing large positions in a handful of securities, together with media firm ViacomCBS (NASDAQ:), utilizing derivatives he trades with Wall Road banks. The trades enable Hwang to build up leveraged positions within the shares with out proudly owning them and with out having to reveal his stakes.
take away adverts
.
March 2021: ViacomCBS publicizes a inventory sale which sends its share value tanking, setting off alarm bells at Archegos’ banks. Banks name on the fund for extra collateral to cowl the elevated publicity on the swaps. However Archegos doesn’t have sufficient liquidity to fulfill the calls.
That results in some banks dumping the shares that again his swaps, inflicting large losses for Archegos and its lenders, resembling Credit score Suisse, now a part of UBS, and Nomura Holdings (NYSE:).
As banks start to report losses, regulators together with the SEC begin probing the collapse of the fund.
April 2022: Federal prosecutors cost Hwang with 11 prison counts and Archegos’ former chief monetary officer, Patrick Halligan, with three prison counts.
Authorities allege Hwang and Halligan lied to banks with the intention to improve Archegos’ credit score traces and use the borrowed cash to control inventory costs.
Hwang faces expenses of racketeering, securities fraud, securities fraud of counterparties and wire fraud together with seven counts of market manipulation. Halligan is charged with racketeering, wire fraud and securities fraud of counterparties.
Each plead not responsible to expenses and are launched on bail.
Hwang’s attorneys’ didn’t instantly reply to a request in search of remark.
Could 2024: Hwang and Halligan’s trial kicks off. They’re anticipated to argue that prosecutors are overreaching by pushing a novel market manipulation idea.
Hwang and Archegos have argued that the SEC has failed to indicate how the New York-based agency traded deceptively or how its swaps trades, which they are saying are lawful, affected costs.
take away adverts
.
