DOJ opens probe into Archegos meltdown that led to $10 billion in losses for banks

• The Department of Justice is opening a probe into the $20 billion meltdown of Archegos Capital.
• Prosecutors are seeking information from banks that dealt with the firm and offered it leverage.
• The late-March unraveling of Archegos led to more than $10 billion in losses for several banks.
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The Department of Justice is opening a probe into $4 according to $4

The late-March unraveling of Archegos, led by Bill Hwang, led to more than $10 billion in losses for several banks, including Credit Suisse, Nomura, and Morgan Stanley. Archegos had built highly leveraged positions in several stocks like $4 which ultimately led to margin calls that the firm could not satisfy.

Credit Suisse was most exposed to Archegos' liquidation, having lost $4 Nomura is thought to $4 while $4

Federal prosecutors in Manhattan have sent information requests to several banks that dealt with Archegos, Bloomberg reported, citing people with knowledge of the matter.

Authorities have not accused Archegos or the banks it worked with of breaking any laws, but some fear the Wall Street fueled blow-up has led to a sense of complacency 12 years removed from the Great Financial Crisis of 2008, which was exacerbated by an unsustainable amount of leverage.

The Securities and Exchange Commission launched a preliminary investigation into Hwang and Archegos in March, and the agency has since explored how to best increase transparency for the derivative bets that proved to be a fatal blow to Archegos, according to Bloomberg.