| In Hwang
Trial For Archegos $34B Meltdown Halligan
Says Bank of America Witness Too Late
By Matthew
Russell Lee, Patreon Substack
SDNY COURTHOUSE,
June 14 – 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
On June 10,
cooperation William Tomita
began on the stand, from thread:
Tomita: Yes. They
were traders, executing the
trades on behalf of Bill. Bill
would yell at me, Don't list
to Andy, you answer to me
On June 11,
Tomita continues. From thread:
Judge: Who picked
the stocks? Tomita: We chose
stocks that were less liquid,
so we could move the stock to
the firm limit. Judge: Who set
the firm limit?
Tomita: Bill did.
Judge: Did you always reach
that limit? Tomita: Not
always. But we tried. Judge:
Were there conversations if
you didn't reach the firm
limit?
Tomita: He would
yell at us... Sometimes he
didn't need to vocalize it, we
could see his expression and
body movement on the Zoom. So
we would try to get the price
to move as quickly as possible
On June 14 to
start the trial day after a
two day hiatus, counsel for
Halligan complained about Bank
of America witness / issue, thread:
"OK - now in US
v. Hwang of Archegos, before
jury comes in after two days
off, AUSA is proffering what a
Bank of America witness would
say.
Defense: Juror
Number 8 is an employee of
Bank of America. We were not
aware of this during voir
dire. Mr. Halligan's right to
a fair and impartial jury is
being undermined. The jurors
have heard evidence for five
years, and now this. Judge: Is
GX 148 admissible?
AUSA: On page 248
of the voir dire, it was said
Bank of America could come up
in the trial, so there is no
issue.
Halligan's
lawyer: We were not on notice
they would claim Bank of
America was lied to. And his
colleague will be on the jury.
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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