Now, the court in New York has delivered its verdict in the Archegos trial. The founder of the hedge fund, Sung Kook «Bill» Hwang, has been found guilty on various counts, as reported by the news agency «Bloomberg.»

He defrauded Archegos's counterparties, such as Credit Suisse (CS) and UBS, by lying about trading activities and risks in the portfolio. The jury also found that Hwang manipulated the prices of several stocks. Patrick Halligan, the former CFO of the hedge fund that collapsed in 2021, was also found guilty on various counts. Both defendants were also convicted of «racketeering conspiracy.»

A lesson for the banks, fatal for CS

The sentence will be determined on October 28. The two convicted individuals face long prison sentences, as each securities fraud count carries a maximum penalty of 20 years, according to «Bloomberg.» Hwang and Halligan remain free on bail until then, with Hwang's bail set at $100 million dollar, significantly higher than Halligan's $1 million dollar.

In addition to CS and UBS, Morgan Stanley and Nomura also suffered losses with Archegos. The total damage amounted to around $10 billion dollar, with CS alone incurring $5,5 billion dollar. The massive write-down proved fatal for CS: it further weakened them financially and damaged trust additionally – thus being a significant factor contributing to their downfall in the US regional banking crisis in the spring of 2023.