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Bill Hwang

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Not to be confused with Bill Huang, founder of CloudMinds.
Bill Hwang
Born
Sung Kook Hwang

1964 (age 59–60)
South Korea
EducationUniversity of California, Los Angeles (BA)
Carnegie Mellon University (MBA)
Occupation(s)Investor; trader
SpouseBecky Hwang
Children1 daughter
Korean name
Hangul
황성국
Revised RomanizationHwang Seongguk
McCune–ReischauerHwang Sŏngkuk

Sung Kook Hwang[1] (Korean: 황성국), also known as Bill Hwang,[2] is a Korean-born American investor and trader.[3][4] He ran Archegos Capital Management, whose default on March 26, 2021 caused major losses to several notable investment banks. In April 2021, The Wall Street Journal reported that Hwang had lost US$20 billion over 10 days in late March, imposing large losses on his bankers Nomura and Credit Suisse.[5] On April 27, 2022, he was indicted on federal charges of fraud and racketeering.[2] The default of Archegos contributed to the eventual collapse of Credit Suisse.[6] On July 10, 2024, a 12-person jury in a federal court in Manhattan found him guilty on 10 out of 11 counts of securities fraud, wire fraud, conspiracy, racketeering, and market manipulation.[7] His sentencing is scheduled for October 28, 2024.

Early life

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Hwang was born in South Korea in 1964.[8]

Hwang earned an economics degree from UCLA and an MBA from the Tepper School of Business at Carnegie Mellon University.[9]

Career

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Hwang began his career at Hyundai Securities in New York, then worked at the now defunct Peregrine Investments Holdings, where he met billionaire hedge fund manager Julian Robertson, who was a client and went to work for Robertson's Tiger Management. Robertson closed the fund in 2000. Still, during his time as its owner, he'd provided some of whom he considered to be his most promising employees, known as the "Tiger Cubs",[10] with funding to start their hedge funds. Robertson gave Hwang a starting capital of about $25 million to launch his own Tiger Asia Management fund,[11] which grew to over $5 billion at its peak,[3] before suffering "heavy losses" during the 2007–09 Great Recession.[12]

Insider trading

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In 2012, Tiger Asia Management and Hwang admitted to illegally using inside information to trade Chinese banks' stocks and agreed to criminal and civil settlements totaling more than US$60 million. Tiger Asia Management, Hwang, Tiger Asia Partners, and former head trader Raymond Park also paid US$44 million in penalties to the Securities and Exchange Commission.[13][14]

In 2014, Hwang was banned from trading in Hong Kong for four years.[11]

Archegos Capital

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In 2012,[15] Hwang closed Tiger Asia Management, and opened a "family office," which is more lightly regulated than a hedge fund,[13] named Archegos Capital Management.[3] The company managed US$10 billion of funds.

In March 2021, losses at Archegos triggered the default and liquidation of positions approaching $30 billion in value, leading to "substantial" losses for Nomura, Credit Suisse, Goldman Sachs, and Morgan Stanley.[13][16] The firm had held prominent positions in ViacomCBS, Baidu, Vipshop, Farfetch, and others. Before the Archegos collapse, Hwang was believed to be worth $10–15 billion, with his investments leveraged at 5:1.[11]

In November 2021, Credit Suisse, having taken a hit of $5.5 billion from the Archegos losses, shut down its prime brokerage business.[17] Texas Capital Bancshares Inc, in which Archegos held a 20% share, plunged after Archegos's collapse.[18]

In January 2024, Hwang sought to block prosecutors from introducing large quantities of trading data at his upcoming trial, citing their "grave failure" in withholding the data for 17 months.[19]

Indictment

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On April 27, 2022, Hwang and his former top lieutenant, Patrick Halligan, were arrested and charged with racketeering, conspiracy, securities fraud, and wire fraud as part of a scheme to harm investors.[20] In a 59-page indictment, Manhattan federal prosecutors alleged that Hwang and Halligan schemed to manipulate stock prices.[20] Lawyers for Hwang and Halligan stated that they were innocent of the charges in the indictment.[20] Hwang was released on a $100 million bond, which was secured by two properties and $5 million in cash. Halligan was released on a $1 million bond.[21]

On September 8, 2022, District Judge Alvin Hellerstein set October 2023 as the month when the trial of Hwang and Halligan, both of whom have pleaded not guilty, will begin. Former Archegos head trader William Tomita and ex-Chief Risk Officer Scott Becker have both pleaded guilty and agreed to testify against Hwang and Halligan.[22] The trial was delayed to February 27, 2024, then to May 6, 2024.[23]

Personal life

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Hwang is a Christian and his father was a pastor.[24] Hwang and his wife reside in Tenafly, New Jersey[25] and they have a daughter who attended Fordham University in New York City.[10]

Philanthropy

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Hwang co-founded the Grace and Mercy Foundation, a charitable organization, which, by 2018, had reportedly "more than US$500 million in assets."[24] Hwang has been noted as one of the largest benefactors of Christian evangelical organizations and causes.[26] Through the Grace and Mercy Foundation, Hwang has made large contributions to Christian organizations such as Focus on the Family, the Museum of the Bible, The King's College, and megachurches such as Brooklyn Tabernacle, Redeemer Presbyterian Church, and Ravi Zacharias International Ministries.[26]

See also

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References

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  1. ^ "Four Charged in Connection with Multibillion-Dollar Collapse of Archegos Capital Management". The United States Department of Justice. 27 April 2022. Retrieved March 17, 2023.
  2. ^ a b Ramey, Corinne; Pulliam, Susan; Chung, Juliet (27 April 2022). "Archegos Founder Bill Hwang and CFO Charged With Securities Fraud". The Wall Street Journal. Retrieved March 17, 2023.
  3. ^ a b c Who Is Archegos Fund Manager Bill Hwang?
  4. ^ Chatterjee, Lawrence Delevingne, Matt Scuffham, Sumeet (2 April 2021). "Seduced by Archegos' growth, Nomura took a chance on Hwang comeback". Reuters. Retrieved March 17, 2023.{{cite news}}: CS1 maint: multiple names: authors list (link)
  5. ^ Zuckerman, Gregory; Chung, Juliet; Farrell, Maureen (April 1, 2021). "Inside Archegos's Epic Meltdown". The Wall Street Journal. Retrieved March 17, 2023.
  6. ^ "Why did Credit Suisse fail, and what does it mean for banking regulation?". Economics Observatory. Retrieved 2024-04-03.
  7. ^ Goldstein, Matthew (10 July 2024). "Jury Finds Archegos Founder Bill Hwang Guilty of Fraud and Racketeering". The New York Times.
  8. ^ Burton, Katherine (April 2, 2021). "God and man collide in rise and fall of Bill Hwang's life on Wall Street". Business Standard. Retrieved March 17, 2023.
  9. ^ GmbH, finanzen net (March 29, 2021). "The man at the heart of the Archegos fiasco is a 'Tiger cub' and devout Christian who pleaded guilty to insider trading. Meet Bill Hwang". Business Insider. Retrieved March 17, 2023.
  10. ^ a b "Bill Hwang and the Fall of Archegos Capital Management". Value of Stocks. July 1, 2022. Retrieved March 17, 2023.
  11. ^ a b c Celarier, Michelle. "The Two Tiger Cubs at the Center of Friday's $35 Billion Meltdown". Institutional Investor. Retrieved March 17, 2023.
  12. ^ Jannarone, John (March 29, 2021). "Behind the Archegos Meltdown: How Banks Quickly Got Religion about Bill Hwang". Yahoo!.
  13. ^ a b c Yamazaki, Makiko; Revill, John; Scuffham, Matt (28 March 2021). "Global bank losses may top $6 billion on Archegos downfall". Reuters. Retrieved March 17, 2023.
  14. ^ "Bill Hwang guilty of illegal trading at Tiger Asia Management". South China Morning Post. 14 December 2012. Retrieved March 17, 2023.
  15. ^ "Familiar Tale as High-Flying Bill Hwang's Tiger Asia Closes". Institutional Investor. August 27, 2012. Retrieved March 17, 2023.
  16. ^ Bray, Chad (29 March 2021). "Investment banks warn of 'significant' losses following margin calls related to Tiger Asia Management founder's family office". South China Morning Post. Retrieved March 17, 2023.
  17. ^ "Credit Suisse to exit prime brokerage following Archegos Capital losses". Archived from the original on 2021-11-04.
  18. ^ "Bill Hwang Made a Huge, Secret Bank Bet Before Archegos Collapse". Bloomberg News. 17 November 2021. Archived from the original on 2021-11-23. Retrieved March 17, 2023.
  19. ^ Stempel, Jonathan (2024-01-09). "Archegos founder Hwang seeks sanctions over prosecutors' 'grave failure' on data". Reuters. Retrieved 2024-02-10.
  20. ^ a b c Goldstein, Matthew (2022-04-27). "Federal agents arrest Archegos owner Bill Hwang and a former top lieutenant". The New York Times. ISSN 0362-4331. Retrieved March 17, 2023.
  21. ^ Berk, Christina Cheddar (2022-04-27). "Archegos owner Bill Hwang and former CFO Halligan plead not guilty to U.S. fraud charges". CNBC. Retrieved March 17, 2023.
  22. ^ Van Voris, Bob (September 8, 2022). "Bill Hwang Gets October 2023 Trial Over Archegos Collapse". Bloomberg News. Retrieved March 17, 2023.
  23. ^ Dolmetsch, Chris (January 22, 2024). "Bill Hwang's Archegos Fraud Trial Delayed to May 6 From Feb. 27". Bloomberg News. Retrieved January 29, 2024.
  24. ^ a b Delevingne, Lawrence (30 March 2021). "Comeback quashed for faith-driven investor Bill Hwang". Reuters. Reuters. Retrieved March 17, 2023.
  25. ^ Aliaj, Ortenca; Platt, Eric; Jung-a, Song; White, Edward (2 April 2021). "'He never struck me as a big risk-taker': Bill Hwang's big bet blows up". Financial Times.
  26. ^ a b Blair, Leonardo; Reporter, Senior Features (2022-05-05). "Once top benefactor in Evangelical world, billionaire Bill Hwang could spend life in prison after arrest". The Christian Post. Retrieved 2023-03-22.
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