SEC reports progress toward settling with Archegos' Bill Hwang

NEW YORK, March 13 (Reuters) - The U.S. Securities and Exchange Commission said it has made "substantial progress" toward settling its civil litigation against convicted Archegos Capital Management founder Bill Hwang and other defendants over the March 2021 collapse of the family office that once managed $36 billion.

In a letter filed jointly with defense lawyers in Manhattan federal court on Friday, the SEC said it has had "very productive" talks with Hwang, convicted former Archegos Chief Financial Officer Patrick Halligan and Archegos itself and hopes to resolve outstanding issues in the near future.

The SEC also said its staff has agreed in principle to settle claims against Archegos' former chief risk officer Scott Becker and former head trader William Tomita, who both testified against Hwang and Halligan at their criminal trial.

Lawyers for the defendants did not immediately respond to requests for comment.

Archegos' collapse stemmed from Hwang's use of financial contracts known as total return swaps to make large, concentrated bets in media and technology shares.

He was unable to meet margin calls on tens of billions of dollars in loans he obtained from banks to build an estimated $160 billion of exposure to stocks.

Hwang and Halligan were convicted of fraud in July 2024, and later sentenced to 18 years and eight years in prison, respectively. Both are appealing and free on bail.

The SEC asked the judge overseeing its civil case to set a May 13 deadline for a further update.