Archegos founder Hwang must face SEC fraud charges
Source: Reuters
Archegos founder Hwang must face SEC fraud charges
Jonathan Stempel
Tue, September 19, 2023 at 2:00 PM EDT·2 min read
NEW YORK (Reuters) - A federal judge on Tuesday rejected Bill Hwang's bid to dismiss a U.S. Securities and Exchange Commission lawsuit accusing him of fraud that led to the March 2021 collapse of his $36 billion firm Archegos Capital Management.
U.S. District Judge Paul Oetken in Manhattan said the SEC plausibly alleged that Hwang and Archegos, which is also a defendant, intentionally concealed the risks they were taking in their bid to manipulate markets through swaps transactions and to artificially inflate the value of their largest stock holdings.
Oetken dismissed some fraud-based claims against former Archegos Chief Financial Officer Patrick Halligan, while letting the SEC pursue claims that Halligan aided and abetted fraud by former Archegos risk management chief Scott Becker.
The judge also granted a request by the U.S. Department of Justice to put the SEC civil case on hold while it pursues related criminal charges against Hwang and Halligan.
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