Archegos Capital Management founder Bill Hwang and the fund’s chief financial officer Patrick Halligan were arrested Wednesday by federal agents on criminal charges including securities fraud, wire fraud and racketeering.

In a lawsuit filed in the Southern District of New York, US prosecutors allege Hwang — whose Archegos fund spectacularly collapsed in March 2021, sending shock waves through Wall Street and saddling big banks including Morgan Stanley and Credit Suisse with more than $10 billion in losses — had increased the size of his family office portfolio from $1.5 billion to $35 billion in just one year.

Hwang and his conspirators were involved in a “brazen scheme” to “manipulate the market” that defrauded “many leading global investment banks and brokerages,” according to the suit.

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