U.S. Justice Department starts probe on Archegos collapse – Bloomberg News
12:41 am Thursday, May 27th, 2021
(Reuters) – The U.S. Department of Justice is investigating the collapse of Bill Hwang’s Archegos Capital Management, which cost big global banks more than $10 billion in losses, Bloomberg News reported on Wednesday.
Federal prosecutors in Manhattan sent requests for information to some banks that had worked with the investment firm, the report said https://bloom.bg/2QVsCyV, citing people familiar with the matter.
It is unclear what potential violations or entities were being examined, the report added
Archegos, a family office run by ex-Tiger Asia manager Bill Hwang, defaulted on margin calls in March, which left banks nursing heavy losses after a fire sale of shares, including ViacomCBS and Discovery Inc, had been meant to act as collateral.
Credit Suisse lost more than $5 billion and Japan’s Nomura lost almost $3 billion. U.S. banks such as Goldman Sachs, which also acted as brokers for Archegos, suffered much lower losses.
A spokesperson for the U.S. attorney’s office in Manhattan declined to comment. Archegos could not be reached for a comment.
(Reporting by Radhika Anilkumar in Bengaluru, additional reporting by Chris Prentice in Washington; editing by Uttaresh.V)
