NEW YORK, May 8 (Reuters) - Sung Kook "Bill" Hwang

arrived in court Wednesday for the start of his criminal

racketeering trial over the collapse of Archegos Capital

Management, facing charges that he and a deputy broke the law in

a massive stock scheme that unraveled in just days in 2021.

Hwang appeared in a dark suit and purple tie in the

Manhattan federal courtroom for the first day of screening

potential jurors.

The potential jurors were called into the judge's

chambers one by one for an initial round of questioning, which

will focus on whether they can sit for the expected eight weeks

of trial.

Those who pass that hurdle will face more detailed

questioning regarding their suitability on Thursday before the

final panel is chosen.

The trial will delve into the implosion of Hwang's lightly

regulated family investment office, which prosecutors allege

caused more than $100 billion in shareholder losses at companies

in its portfolio.

Federal prosecutors accuse Hwang of using derivatives to

secretly amass positions in multiple stocks that were so large

they eclipsed that of the companies' largest investors, driving

up stock prices.

They also claim Hwang and former Archegos Chief Financial

Officer Patrick Halligan then lied about their holdings to

sustain their business relationship with global banks.

Hwang and Halligan are charged with racketeering conspiracy.

Hwang faces an additional 10 counts of fraud and market

manipulation, and Halligan an additional two counts of fraud.

The two men have pleaded not guilty and are expected to

argue prosecutors are pushing a novel and nonsensical market

manipulation theory. Several attorneys told Reuters it may be a

tough case for prosecutors.

Hwang's lawyers have described the case as the "most

aggressive open market manipulation case ever" brought by

prosecutors.

Each count carries a maximum potential sentence of 20 years.

Archegos head trader William Tomita and Chief Risk Officer

Scott Becker have pleaded guilty to related charges and are

expected to testify at the trial.

Opening statements are expected on Monday before 12 jurors

and four alternates. The judge has said there are unlikely to be

proceedings on Fridays.

Archegos' March 2021 collapse stemmed from Hwang's use of

financial contracts known as total return swaps to take outsized

stakes in his favorite holdings without actually owning the

stock.

Authorities have said Archegos borrowed aggressively to

boost trading capacity and at its peak had $36 billion in assets

and $160 billion of exposure to equities. Falling stock prices

in March 2021 triggered margin calls that Archegos was unable to

meet.

That led some banks to dump stocks backing his swaps,

causing big losses for Archegos and its lenders, such as Credit

Suisse, now part of UBS, and Nomura Holdings ( NMR ).

U.S. District Judge Alvin Hellerstein, who is overseeing the

trial, rejected Hwang and Halligan's motion to dismiss the case

last year.