- Senate Banking Committee Chairman Sherrod Brown, D-Ohio, wants regulators to take a look at the Archegos meltdown.
- The committee has jurisdiction over the world's largest banks and regularly engages with the heads of the Securities and Exchange Commission.
- Brown is the latest lawmaker to speak out on the incident. Sen. Elizabeth Warren, also a member of the banking committee, told CNBC that the meltdown "had all the makings of a dangerous situation."
Sen. Sherrod Brown, the Democratic chairman of the powerful Senate Banking Committee, is setting his sights on Archegos Capital Management after the fund's recent losses sent shockwaves through markets.
"Once again, investment banks put profits first and enabled risky derivatives trading that resulted in billions of dollars in losses," Brown said in a statement to CNBC on Wednesday. "We must make sure our financial watchdogs work together to protect the financial system and our economy. I expect the SEC and other regulators to take a closer look."
The committee has jurisdiction over the world's largest banks and regularly engages with the heads of the Securities and Exchange Commission.
Brown is the latest lawmaker to speak out on the incident. Sen. Elizabeth Warren, D-Mass., who is also a member of the Banking Committee, told CNBC on Tuesday that "Archegos' meltdown had all the makings of a dangerous situation."
The disastrous trades last week by Archegos, a family office founded by former Tiger Management analyst Bill Hwang, sent the stock of ViacomCBS and many others into a downward spiral.
By the time Credit Suisse and Nomura, two prime brokers for Archegos, announced early Monday that they faced losses that could be "highly significant" for the banks, rival firms Goldman Sachs and Morgan Stanley had already finished unloading their positions, according to people with knowledge of the matter. They requested anonymity in order to speak about private negotiations.
Goldman managed to sell most of the stock related to its Archegos margin calls on Friday, helping the firm avoid any losses in the episode, according to one of the people. Morgan Stanley sold $15 billion in shares over a few days, avoiding significant losses, CNBC's Leslie Picker reported.