Archegos Capital Management’s Bill Hwang will go on trial on fraud charges in October next year, a federal judge in New York said.

U.S. District Judge Alvin Hellerstein set an Oct. 10, 2023, trial date for Hwang and former Archegos Chief Financial Officer Patrick Halligan at a conference on Thursday. And their lawyers previewed the legal arguments they plan to make in pre-trial motions seeking to have charges dismissed before trial.

The two men, who have pleaded not guilty, were both present for the conference in Manhattan federal court. Prosecutors said the trial could take about two months. Lawyers for Hwang and Halligan had asked for a trial date in early 2024.

Hwang was arrested April 27 and charged with fraud over the collapse of Archegos, which at one point held market positions valued at $160 billion, according to prosecutors. The two face decades in prison if convicted.

Prosecutors claim Hwang and Halligan “repeatedly made materially false and misleading statements about Archegos’s portfolio of securities to numerous leading global investment banks and brokerages,” inflicting steep losses on Credit Suisse Group AG, Nomura Holdings Inc. and Morgan Stanley. The fall of Archegos cost banks $10 billion and exposed huge problems in how risk is managed.

Lawrence Lustberg, a lawyer for Hwang, told Hellerstein that he’ll seek dismissal of the racketeering conspiracy, securities fraud and market manipulation charges against his client. He also said he plans to file a motion raising questions about the “process that resulted in charges” in the case.

Asked to explain outside court, Lustberg said, “We do not think that we were afforded a fair pre-trial process.” 

Hwang’s team has publicly expressed frustration that their client was arrested and charged despite voluntarily answering questions from the government for months.

“In no event was an arrest necessary,” his attorneys said in a statement at the time.

Lustberg on Thursday also told the judge he expects to file motions to bar evidence seized by agents and claiming prosecutors failed to turn over exculpatory material.

Not A Trader
Mary Mulligan, a lawyer for Halligan, said her client will make some of the same legal arguments as Hwang, but told Hellerstein he will raise some additional issues.

“He is not involved in trading whatsoever,” she said, yet is included in the racketeering conspiracy charge focused on market manipulation and fraud.

Two longtime Archegos colleagues, former head trader William Tomita and ex-chief risk officer Scott Becker, pleaded guilty and are expected to take the witness stand against them. They have agreed to cooperate with the government in hopes of leniency when they’re sentenced.

The case is U.S. v. Hwang, 22-cr-00240, U.S. District Court, Southern District of New York (Manhattan).

This article was provided by Bloomberg News.