The Monetary Authority of Singapore has banned the co-founders of fallen crypto hedge fund Three Arrows Capital.
The MAS has issued nine-year prohibition orders to Zhu Su and Kyle Livingston Davies for violating the city-state’s securities and futures act, according to a statement, effective September 13.
Three Arrows co-founders Zhu and Davis have been banned from «performing any regulated activity and form taking part in the management of, acting as a director of or becoming a substantial shareholder, of any capital market services firm» under the act.
Regulatory Probe
According to the regulator, Three Arrows provided false information, lacked appropriate risk management frameworks and exceeded the asset threshold to be a registered fund management company. The firm also failed to make notifications about key information such as changes to directorship, shareholdings and the employment portfolio manager Cheong Jun Yoong Arthur.
«Senior management of fund managers are required to implement robust risk management measures to protect the interest of investors. MAS takes a serious view of Mr. Zhu’s and Mr. Davies’ flagrant disregard of MAS’ regulatory requirements and dereliction of their directors’ duties,» said assistant managing director (policy, payments & financial crime) Loo Siew Yee.
Singapore-based Three Arrows collapsed in 2022 amid a crypto market downturn. Thereafter, Zhu and Davies could not be found before the former reportedly resurfaced in Thailand. Liquidators have obtained court orders to recover $1.3 billion in losses but claim that the two have failed to cooperate meaningfully in investigations. Counsel to the Three Arrows founders called the court order «baseless».
