Discretion without a plan: family office reputation after Archegos and the Sacklers

The number of single family offices worldwide has grown by almost a third since 2019, to more than 8,000 (Deloitte). Most are built to preserve and grow wealth. Far fewer are built to protect the reputation attached to it, in part because the confidentiality surrounding a family office can appear to offer protection enough. But confidentiality and protection are different things. Confidentiality limits what outsiders can see; it does little to shape what they conclude once something goes wrong. The two cases below – one a family office, the other a family whose business and philanthropy carried its name – illustrate how that gap can play out.

Archegos Capital Management was a family office managing the personal fortune of American investor and trader Bill Hwang. At its peak his family office was managing over $36 billion in assets (Reuters). Hwang was not new to controversy: in 2012 the SEC banned him from managing hedge funds over insider trading and attempted market manipulation charges, and his fund, Tiger Asia, pleaded guilty to criminal wire fraud. He settled, paying $44 million, closed his old fund and reopened as Archegos (SEC). Operating as a family office also meant far lighter regulatory scrutiny than a hedge fund would face.

Archegos built enormous, concentrated stock positions using total return swaps, derivatives that let Hwang bet big without owning shares outright and without the public disclosure normally required of a large shareholder. Several banks, including Credit Suisse, Nomura, Morgan Stanley and UBS, extended huge credit, each seeing only its own slice of his exposure (The Trade). When ViacomCBS and several Chinese tech stocks dropped sharply in March 2021, Hwang could not meet margin calls, and the positions unwound within days, leaving several of his banks with multibillion-dollar losses (Wall Street Journal). Hwang was sentenced to 18 years for fraud, racketeering and market manipulation (Bloomberg).

Reputation also shaped how the Archegos collapse unfolded and was understood. Because Hwang operated with a deliberately low public profile and no disclosed positions, there was no existing narrative to draw on when the collapse happened; the story became largely about concealment (Financial Times). That secrecy also removed any early-warning mechanism. Firms with real visibility face pressure to disclose risk sooner, and Archegos’s structure spared it that pressure. In addition, Hwang’s sanctioned past should have carried more reputational weight with counterparties than it did. Instead, banks competed for his business and extended him huge credit anyway, and that track record does not appear to have been fully priced into the risk (BDO). A family office with even a baseline public reputation for transparency and a good relationship with regulators and counterparties has a chance to influence how a crisis unfolds. Archegos had little of that, and the least favourable account filled the gap.

The Sackler family, owners of Purdue Pharma, the maker of the prescription painkiller OxyContin, did not operate through a family office in this story, but it faced the kind of exposure family offices are often set up to manage – in this case, through philanthropy. For decades, the family’s name sat on galleries and buildings at the Louvre, the Met, Yale and Tufts, a naming strategy that writer Patrick Radden Keefe has linked to what critics call “reputation laundering” (Sunday Post). As litigation over the company’s role in the US opioid crisis intensified, that visibility turned into liability: the Louvre removed the name in 2019, the Met followed in 2021, and Yale began stripping the name from campus in 2022 as the family agreed to pay up to $6 billion in settlements (Semafor). The family and Purdue later reached a $7.4 billion settlement in 2025, with the family losing control of Purdue entirely (BBC). A name attached to dozens of institutions with no coordinated plan for what happens if the underlying business turns toxic is a liability sitting in plain sight.

Both cases point to the same risk. Archegos stayed out of view and the Sacklers maintained a highly visible philanthropic profile, yet in each case the family’s reputation proved difficult to defend once scrutiny arrived. For family offices today, that exposure is widening. Direct deals account for a growing share of family office portfolios, yet only 20% of family offices doing direct deals take a board seat (Wharton Family Office Survey). That can leave a family’s name attached to companies over which it has limited influence.

The groundwork has to be laid before it is needed. In practice, that comes down to three decisions:

• How the office and its principals want to be understood by the audiences that matter to them – counterparties, regulators and the institutions they fund – and what they are prepared to do to earn that standing.
• Who speaks, what is said and how quickly if a portfolio company, a family member or a philanthropic partner comes under scrutiny.
• Which information stays private by choice, and on what grounds, rather than by habit.

Discretion remains a legitimate choice for a family office. The problem arises when it stands in for a plan, because once scrutiny arrives, silence tends to leave the account to whoever speaks first – regulators, litigants or the press.

Global Reputation Advisors advises family offices, principals and their advisers on reputation strategy, from establishing a deliberate public position to preparing for scrutiny before it arrives. We would welcome a conversation about how this applies to your office – get in touch: [email protected].