Bill Hwang, 60, is accused of fraud that wiped out billions for clients like Viacom and Discovery and led to the eventual downfall of Credit Suisse bank in 2023|@Awawat_Trades|X
Korean-American billionaire Bill Hwang’s Archegos Capital Management (ACM) firm, which held portfolios worth over $100 billion, collapsed within a week in 2021. He is now facing trial on 11 counts of racketeering, conspiracy, and fraud.
Hwang, 60, is accused of orchestrating a “pump and brag scheme” that wiped out billions for clients like Viacom and Discovery and contributed to the eventual downfall of Credit Suisse bank in 2023.
He has pleaded not guilty to the charges, each carrying a maximum sentence of 20 years in prison.
What happened?
ACM’s collapse is attributed to Hwang engaging in deceptive practices to inflate the stock values of publicly traded companies, primarily Viacom and Discovery. He allegedly concealed the extent of his firm’s positions from banks and regulators.
When stock prices fell, ACM couldn’t cover its losses, leading to a cascade of margin calls and liquidations. It led to Viacom losing more than 50% of its value and bank Credit Suisse taking a hit on the $5.5 billion it lent to ACM.
The recent suit is not Hwang’s first. In 2012, he pleaded guilty to wire fraud related to his previous hedge fund, Tiger Asia Management.
The trial represents a significant moment for Wall Street accountability and regulatory scrutiny, highlighting the risks of opaque market practices and lax oversight.