Department of Justice is Investigating the Archegos Incident

An investigation has been launched into the Archegos incident, which caused many corporations to sell billions of dollars of shares, with its adverse position.

The Department of Justice is investigating the Archegos incident that is shaking the market. The hedge fund Archegos, which remained in an adverse position in March, causing many investment banks to sell billions of dollars in shares to collect collateral, was subject to investigation by the US Department of Justice. According to sources close to the subject, which made statements to Bloomberg, DOJ sent information requests to some banks on the subject. It is not yet known for which violations the banks are subject to investigation. Due to the Archegos incident, many investment banks, especially Credit Suisse and Nomura, reported billions of dollars in losses.

Credit Suisse Loses $ 654 Million

Credit Suisse reported that it expected a $ 654 million loss in the second quarter of the year due to the bankruptcy of the US hedge fund Archegos Capital. Morgan Stanley, one of Archegos' biggest brokers, had sold some of its most risky positions to hedge funds, one night before sales at a loss caused heavy losses to other investment banks. Morgan Stanley sold a small hedge fund group on the evening of March 25, Archegos' positions that had risen to $ 5 billion in US media and Chinese technology companies. While Morgan Stanley survived this situation that shook the markets in the most damaging way, Deutsche Bank sold its Archegos positions to a hedge fund and narrowly escaped the disaster. Deutsche Bank, which sold its Archegos position at the level of $ 4 billion to hedge funds on March 26, shortly after the fund went into default, narrowly escaped this disaster, which caused billions of dollars in losses to many banks.