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Archegos founder Bill Hwang was allowed to remain free while he challenges his criminal conviction in the multibillion-dollar collapse of his investment fund, but a US judge started the clock ticking on his appeal.
Hwang, whose family office Archegos Capital Management triggered huge losses for some of the world’s biggest banks when it collapsed in 2021, was last year sentenced to 18 years in prison for orchestrating a massive fraud and ordered to pay $9bn to victims of the scheme.
Archegos’s collapse caused as much as $10bn in losses for banks and was one of several crises that helped precipitate the collapse of Credit Suisse. But through a quirk in the scheduling of his sentencing proceedings, Hwang has been allowed to stay out of custody for more than a year since his conviction on fraud and market manipulation charges.
The proceedings finally concluded at a hearing on Tuesday in Manhattan federal court, setting the stage for the next phase of Hwang’s case. Judge Alvin Hellerstein confirmed the arrangement allowing the 61-year-old to remain free, but he must now begin the appeal process and would be required to surrender to authorities within three months if his conviction is upheld.
It is not unheard of for white-collar defendants to be allowed to stay out of jail while they appeal, but some white-collar lawyers said the agreement seemed unusual in this case given the length of Hwang’s sentence.
Hwang, wearing a suit and chunky glasses with his trademark mane slicked back, betrayed little emotion during the hearing into how his assets will be sold to compensate victims.
Hwang has an art collection that he “is in a position to liquidate . . . through private sales”, his lawyer Brian Jacobs told the court. Patrick Halligan, Archegos’s chief financial officer who was also convicted in the case, would give up a collection of cars and keep just three — a Lincoln Navigator, an Audi and a Ford Mustang, his lawyer said.
Hellerstein said money to compensate the victims would be collected and held in a separate account for a period of time, rather than handed to victims more quickly as prosecutors had argued for.
Hwang’s investments in private equity funds would not be liquidated immediately because such sales are typically done at a discount and could reduce the amount available to his victims, prosecutors said. Instead, Hwang will be told to transfer the proceeds promptly when the funds pay out, which could take years.
