Former billionaire investor Sung Kook “Bill” Hwang has been sentenced to 18 years in prison for the collapse of Archegos Capital Management, resulting in over $10 billion in losses for Wall Street banks. Hwang was convicted on 10 criminal charges including wire fraud, securities fraud, and market manipulation.
United States District Judge Alvin Hellerstein handed down the sentence, stating that the losses caused by Hwang’s conduct were the largest he had seen. The US Attorney’s office sought a 21-year prison term for Hwang and for him to forfeit $12.35 billion and provide restitution to victims.
Hwang’s implosion of Archegos in March 2021 shocked Wall Street and lenders. The sentencing hearing is ongoing, with a decision on forfeiture and restitution pending. Hwang’s lawyer argued against prison time, citing his minimal risk of committing future crimes.
Hwang’s aggressive borrowing and concentration on media and technology stocks led to his downfall when he couldn’t meet margin calls. More than $100 billion of market value in his stocks was wiped out, causing losses for banks like Credit Suisse and Nomura Holdings.
Hwang’s lawyers highlighted his charitable contributions through the Grace and Mercy Foundation but acknowledged his decreased net worth to around $55.3 million. His co-defendant, former CFO Patrick Halligan, was also convicted and awaits sentencing.
Hwang’s case stands out as a national calamity and a rare occurrence in white-collar crime. The sentencing hearing will resume shortly, with implications for the future of financial regulation and accountability in the industry.
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