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U.S. Justice Department starts probe on Archegos collapse – Bloomberg News – Metro US

U.S. Justice Department starts probe on Archegos collapse – Bloomberg News

888 7th Ave, a building that reportedly houses Archegos Capital
888 7th Ave, a building that reportedly houses Archegos Capital is pictured in New York City

(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)

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