Hwang’s Acolyte Li Is Mystery Fund Manager in Archegos Case (2)

As Bill Hwang’s Archegos Capital Management sought to supersize a favorite stock bet beyond what banks were willing to carry out, he turned to a hedge fund run by an old friend, according to U.S. prosecutors.

That mystery fund manager, identified only as “Adviser-1” in Hwang’s indictment unsealed Wednesday, is Tao Li, the head of Teng Yue Partners, a New York-based firm that oversaw $4 billion as of last year, according to people with knowledge of the investigation. Li and Teng Yue haven’t been accused of wrongdoing by U.S. authorities.

The indictment splays open what was happening behind ...