The founder of collapsed family office Archegos calls on a federal judge to dismiss a lawsuit over what he terms «entirely legitimate» practices.
Bill Hwang, together with defunct family office Archegos, urged a federal judge to dismiss the US Securities and Exchange (SEC) lawsuit claiming fraud against both parties, according to a «Reuters» report citing court filings. Both claimed that the regulator failed to show that the fallen family office had engaged in deceptive trading and market manipulation.
«The SEC declares unlawful a number of practices that have long been accepted as entirely legitimate and commonplace in the market,» Hwang indicated in his filing.
«No trader could have known that these kinds of actions would someday be deemed unlawful, simply because Mr. Hwang's trading backfired in the short term, costing him, but no other investors, billions of dollars in losses,» the news service quoted him as saying. The Archegos filing called his transactions no different from «an enthusiastic investor with the means to pursue an investment opportunity».
Supreme Precedent
Moreover, Archegos stated that Supreme Court precedent blocked the SEC from pursuing claims that the family office violated securities laws by deceiving banks about its liquidity and portfolio concentration to secure funding for trades.
Hwang and ex-Archegos chief financial officer Patrick Halligan pleaded not guilty to the Department of Justice over fraud and racketeering conspiracy charges and their criminal trial is scheduled for October next year.
