By Matthew Russell Lee, Patreon Substack
SDNY COURTHOUSE, June 6 – In the wake of the Archegos meltdown, the other shoe dropped on April 27, when the US Attorney for the SDNY unsealed and indictment charging Bill Hwang Patrick Halligan, Archegos’s CFO with racketeering conspiracy, securities fraud, and wire fraud offenses.
Inner City Press went to the SDNY press conference to ask, What about Credit Suisse and Nomura and people in those banks? What about the massive family office loophope to the Investment Advisors Act of 1940? This has come up in the OneCoin fraud case, on which the Office used perjured testimony and now agrees to delay after delay.
Damian William referred obliquely to Hwang doing it in the dark, but otherwise the issue - which is addressed by a pending bill in Congress - did not come up. Nor did Lisa Monaco, present in New York for the presser, address it.
On June 1, newly assigned District Judge Alvin K. Hellerstein held a conference in the case. Inner City Press attended and live tweet it here (and asked defense counsel a question later, here). Thread here.
And after, stand-up here, short Q&A here.
On June 20, 2023 Judge Hellerstein pushed the trial back: "Trial in the above-captioned criminal matter, by request of all parties, is adjourned from January 9, 2024 to February 20, 2024 at 10:00 a.m., in Courtroom 14D. The Final Pretrial Conference will be held on February 14, 2024 at 2:30 p.m. Time is excluded in the interest of justice from January 9, 2024 to February 20, 2024 pursuant to 18 U.S.C. § 3161. SO ORDERED (Signed by Judge Alvin K. Hellerstein on 6/20/2023)."
On July 27, Hwang wrote in seeking approval of subpoenas to Goldman Sachs, Morgan Stanley, Bank of Montreal, Credit Suisse, UBS, Nomura, MUFG, Mizuho, Macquarie, Jeffries and Deutsche Bank, to show he did not "use his lawfully executed swaps to artificially impact the prices of the underlying stocks."
Jump cut to November 14, 2023 when Judge Hellerstein held an oral argument on the subpoena requests. Inner City Press attended, in mask, and tweeted, threadette:
Hwang is here at defense table, with COVID mask and foyr lawyers at table, one behind.
Judge Hellerstein: Manipulation for manipulation is meaningless. How was it intended to make money? When? There are many different ways to hedge. I'd like to see them narrowed
Berke: Your Honor, you've done a lot of cases, but this is the 1st one in which DOJ is charging manipulation of swaps
Judge: It's hard to defend against manipulation. Mr Berke deserves a discussion. US v Nixon provides the boundary.
Berke: Thank you
And well he might say that - it seemed the defense won this round. He mocked what he called the prosecution's theory of "pump and brag," that Hwang did it to brag he'd built a family office into a major firm.
On January 3, 2024, still mostly masked, Judge Hellerstein said the proposed experts are qualified, that sufficient notice is the issue. He said he will follow Judge Jed Rakoff's decision in US v. Mrabet, which Inner City Press also covered. At the end Judge Hellerstein said, with a laugh, Don't settle this case, I want to try it.
More details on Substack here
On May 1, 2024, the US Attorney's Office wrote in to specify that at trial they intend to put forward evidence about Archegos' predecessor Tiger Asia, including that the SEC banned Hwang from acting, among other things, as an investment adviser.
On May 6, Halligan's counsel wrote in that the evidence should not be admitted at trial, as little of it involves Halligan but he would be prejudiced by it.
On May 15 in the trial, Mr. Marks of Operations testified about reports only to Bill and Patrick, then Mr. Jones about flying from Dallas amid the meltdown. Thread here
On May 21, the US insisted that evidence of Hwang's "decision not to reimburse employees for lost deferred compensation" should remain in evidence before the jury."
Full letter on Patreon here.
On May 22, Inner City Press live tweeted cross examination of cooperator Becker, here. In the midst of it, an announcement by Judge Hellerstein of the birth of a baby, and applause in the courtroom (it's in the thread).
On May 23, Becker continued - from the thread:
Becker is asked about his message, "Whatevs, we'll just roll with it."
Counsel: Turning to your lost vacation days, Mr. Becker, you felt you had never worked harder than at Archegos, isn't that true? Becker: Yes.
Counsel: You had 3 weeks of vacation - couldn't carry it over and you were angry, right? Becker: Correct.
Halligan's lawyer: You didn't want Mr. Halligan involved in your project, did you? He called you careless-
Judge Hellerstein: Haven't we gone over this? It's done. Finished. Halligan's lawyer: You felt he didn't show appreciation Judge Hellerstein: Move on
Now re-direct: AUSA: Mr. Becker, Mr. Berke didn't show you this sheet, did he? Objection! Overruled. Becker: He didn't.
AUSA: You were asked some questions about conversations with Mr. Halligan. Why was it so frantic? Let me off this March 23 chat, 3745
Judge Hellerstein: Jurors, have a good weekend. [Jurors leave] Defense: Can we discuss schedule for next week? Judge: Tues and Wed 10 to 5. Can't say about Thursday. Government, how are we doing?
AUSA: We expected Becker 1 week, on schedule
Judge Hellerstein: Done in 2 weeks? AUSA: That's aggressive. Adjourned.
On May 28, the US Attorney's Office filed a letter seeking permission in advance to ask "what if you had known" questions of the type blessed by the 2d Circuit in US v. Cuti (2013), starting with Bank of Montreal's Joseph Boccuzzi on May 29. Letter on Patreon here
May 29 ended with a dispute about a government chart, long and short positions, which Hwang's lawyer Berke called argumentative, from the thread:
Judge Hellerstein: How do you proposed to change your chart before showing it to the jury? The title should change.
AUSA: I can pass up copies. Judge: Just say, Portion of the portfolio. Why do you have to say "long"? AUSA: Achegos has a short portfolio too
Hwang's lawyer: This was, it's argumentative and misleading. AUSA: We can work on something...
Judge Hellerstein: Let's do it now. I have both of you, and I've already canceled my appointment...
On May 30, the US Attorney's Office filed opposition to Hwang's bid to strike testimony of UBS's Christ Salcedo...
On June 5, Inner City Press live tweeted, thread
On June 6, government expert testified about, among other things, dark pools, thread:
Assistant US Attorney: Tell the jury what a dark pool is. Expert: On an exchange, if I was to submit a limit order, if it were posted, the price would rise. You are giving away your interest. The dark is meant to replicate - you can post orders and nobody sees it
Expert: My favorite dark pool is called Liquid Net. I've got a nice paper about this, how violations of trust impact this. I tell Liquid Net my order and no one sees it. Judge: Who runs the dark pool? Expert: Goldman, Barclays, Deutsche Bank.
Judge: I don't think there is a very good understanding of dark pools. Let's take a break.
And so it goes. Watch this site.
Back on March 21, 2023 Judge Hellerstein held an hour and a half proceeding in which he denied more than a dozen motions by Team Hwang. Inner City Press was there and live tweeted, thread here.
More including on Halligan on Substack here.
Later - after re-up of book and talk to NYU Journalism School, here and here - in the SDNY Magistrate a defendant was detained until trial, charged as a felon in possession. We'll have more, much more, on this.
The case is US v. Hwang, 22-cr-240 (Hellerstein)
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