A former employee of Arquegos, an investment company that lost more than $ 10 billion in the last few days, is suing the company and its founder, Bill Hwang, and five former top executives. The proceedings were filed in the Federal District Court in Manhattan on Tuesday, the DealBook newsletter reports.
High-tech stock analyst Brendan Sullivan, who joined Arquegos in 2014 and resigned shortly after the explosion, said he had lost $ 50 million. We’re screwed.
The proceedings are trying to force Mr. Huang and others to cover the losses. Mr. Huang was acquitted of the government’s proceedings this year after being charged with fraud by a federal prosecutor on suspicion of misleading lenders and market manipulation. Last week, an Arquegos lawyer petitioned the Commodity Futures and Securities and Exchange Commission to dismiss other proceedings against the company.
Employees of the fund were told that they had a guaranteed postpaid plan and were invested in liquid stocks. According to the proceedings, neither claim was true. In addition, employees are forced to donate at least 25% of their annual bonus to the plan and declare how much to postpone it before they know the details of the bonus. “The message was very clear,” the proceedings claim. “No contributions. No bonuses.”
“Fans and these executives lied to their employees as if they lied to the bank,” Sullivan’s lawyer, Michael Bow of Brown Radnick, told DealBook. Mr. Huang’s lawyer and an Archegos spokesman have not responded to requests for comment.
The lawsuit said the fund tried to discourage employees from leaving the company and, if so, questioned the deferred payment of compensation. According to a DealBook letter sent by Arquegos to a former employee, Mr. Sullivan, who retired anyway, did not receive money from the plan, but recently in January, the company promised to receive payment to the former employee. I continued.
The proceedings stated that Arquegos was operating like a “cult.” According to the proceedings, job interviews “revolved around research into religion and the religious development of candidates.” During the performance evaluation, Christian Huang said he told his employees to “spend more time on faith.” According to the lawsuit, at the company’s retreat, employees were praised for publicly expressing their gratitude to “God, Fan, Arquegos.”
