Archegos Capital Collapse: Bill Hwang Faces 21-Year Prison Sentence

Bill Hwang, the founder of Archegos Capital, is facing a 21-year prison sentence for market manipulation that led to the collapse of his $36 billion firm and cost lenders over $10 billion. Hwang was convicted on 10 charges, including fraud, and is expected to appeal the conviction.

Bill Hwang, the mastermind behind Archegos Capital Management, has been recommended a 21-year prison sentence by federal prosecutors. This comes after his market manipulation scheme led to the downfall of his $36 billion firm and inflicted over $10 billion in losses on lenders.

Hwang, aged 60, is slated for sentencing on November 20 in Manhattan's federal court. Convicted in July on charges that include securities and wire fraud as well as racketeering conspiracy, Hwang was accused of deceiving banks to secure loans and place concentrated bets using total return swaps on media and technology stocks, including ViacomCBS.

As his stock exposure ballooned to $160 billion, Hwang struggled to meet margin calls amidst declining prices, causing Archegos to crumble in March 2021. This unraveling resulted in significant losses for banks like Credit Suisse, now merged with UBS, and Nomura Holdings. Meanwhile, Hwang's legal team argues against imprisonment, highlighting lack of proof of deceptive loss causation, his age, health issues, charitable contributions, and minimal recidivism risk.

(With inputs from agencies.)