Archegos collapsed in March 2021, leaving banks with more than $10b in losses and sparking calls for more regulatory oversight. More than $100b in stock market value vanished in a matter of days. The U.S. attorney for the Southern District of New York described the purported scheme as historic in scope, alleging that defendants and their co-conspirators lied to banks to obtain billions of dollars in loans, which they then used to inflate the stock price of publicly traded companies.
“The lies fed the inflation, and the inflation fed more lies,” Mr. Williams said at a news conference. “Last year, the music stopped. The bubble burst. The prices dropped. And when they did, billions of dollars evaporated overnight.”