Hwang had been convicted in July on 10 prison expenses, together with wire and securities fraud and market manipulation.
Former billionaire investor Sung Kook “Invoice” Hwang has been sentenced to 18 years in jail for the collapse of Archegos Capital Administration, which value Wall Avenue banks greater than $10 billion.
Hwang was sentenced Wednesday by U.S. District Decide Alvin Hellerstein in Manhattan, the place a jury convicted Hwang in July on 10 prison counts, together with wire fraud, securities fraud and market manipulation.
“The quantity of loss attributable to his conduct is larger than every other loss he has suffered,” Hellerstein stated earlier than saying the sentence.
Archegos’ implosion in March 2021 lasted lower than per week, stunning Wall Avenue and Hwang’s lenders.
The U.S. legal professional’s workplace in Manhattan sought a 21-year jail sentence for Hwang (unusually lengthy for a white-collar case) and for him to forfeit $12.35 billion and restitution to the victims.
“It’s amongst a uncommon class of circumstances that would actually be described as a nationwide calamity,” prosecutor Andrew Thomas stated at Hellerstein’s sentencing listening to.
Hellerstein didn’t decide Wednesday on whether or not Hwang ought to lose cash or pay restitution. The sentencing listening to is anticipated to renew Thursday.
Earlier than sentencing Hwang, Hellerstein requested the defendant’s legal professional, Dani James, how he thought Hwang in comparison with Sam Bankman-Fried, who was sentenced in March to 25 years in jail for stealing $8 billion from Web customers. bankrupt FTX trade.
“Mr. Bankman-Fried was actually stealing from his shoppers,” James stated. “I do not assume that is what occurred right here.”
Hwang had requested for no imprisonment, forfeiture or restitution, and to stay free on bail whereas he appeals his conviction. James stated his low danger of committing additional crimes meant a protracted jail sentence made no sense.
“The concept he would commit against the law sooner or later is solely not true,” James stated.
Bankman-Fried denies any wrongdoing and is interesting his conviction.
Aggressive borrowing
Hwang, 60, was a protégé of the late hedge fund billionaire Julian Robertson.
He created Archegos in New York as a household workplace in 2013, a 12 months after his former hedge fund Tiger Asia Administration pleaded responsible to wire fraud in an insider buying and selling case.
Prosecutors accused Hwang of mendacity to banks about Archegos’ portfolio so he might aggressively borrow cash and make concentrated bets on media and know-how shares similar to ViacomCBS, now known as Paramount International.
Whereas Archegos ended up managing $36 billion, Hwang’s debt helped him accumulate $160 billion of fairness publicity.
His downfall got here when Hwang was unable to fulfill margin necessities, as costs of a few of his favourite shares started to fall and a number of other banks dumped shares that had backed their so-called whole return swaps.
Greater than $100 billion of the market worth of Hwang’s shares disappeared. A number of banks suffered losses, together with Credit score Suisse, which misplaced $5.5 billion, and Nomura Holdings. Credit score Suisse is now a part of UBS.
Hwang’s attorneys’ non-punishment request additionally cited Hwang’s Christian religion and his Grace and Mercy Basis, a nonprofit that, since 2006, has donated at the least $600 million to fight homelessness. poverty and human trafficking, amongst different causes.
In an announcement to the courtroom earlier than Hellerstein introduced the sentence, Hwang stated he hoped the punishment “would permit me to function a lot as I might underneath the circumstances.”
Hwang’s attorneys have stated his internet price has fallen to “at most” $55.3 million.
Hwang’s co-defendant, former Archegos CFO Patrick Halligan, was convicted in the identical trial on three prison counts. His sentencing is scheduled for January 27. Each selected to not testify at their two-month trial.
