Singapore's central bank doesn't want to hear about 3AC founders for almost a decade.
Kyle Davies and Zhu Su, co-founders of the cryptocurrency hedge fund Three Arrows Capital (3AC), are facing a nine-year prohibition order from the Monetary Authority of Singapore (MAS).
The ban commenced on September 13th and was formally announced by MAS in a statement dated September 14th.
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During the nine years, Davies and Su are prohibited from engaging in any regulated activities. Additionally, they are barred from managing, serving as directors, or holding significant shares in any capital market services businesses within Singapore.
MAS imposed these stringent measures following a thorough investigation into 3AC and its founders. The central bank claims that the pair violated several securities laws, including neglecting to inform MAS about a new business representative, providing false information to the regulatory authority, and lacking an adequate risk management framework.
Loo Siew Yee, the Assistant Managing Director of Policy, Payments, and Financial Crime at MAS, had strong words about the issue, stating:
MAS takes a serious view of Mr Zhu’s and Mr Davies’ flagrant disregard of MAS’ regulatory requirements and dereliction of their directors’ duties.
Loo further emphasized the regulator’s commitment to maintaining the integrity of Singapore’s financial markets, adding:
MAS will take action to weed out senior managers who commit such misconduct.
However, Singapore is not the only place where Zhu and Davies are facing legal issues. In August, Dubai’s VARA issued a hefty penalty of 10 million United Arab Emirates dirhams (around $2.7M) to 3AC founders over their new venture, crypto exchange OPNX.
The nine-year prohibition against the co-founders of Three Arrows Capital underscores Singapore's commitment to maintaining a compliant and transparent financial market, especially in the rapidly evolving cryptocurrency space. As regulatory scrutiny intensifies globally, the action taken by MAS serves as a cautionary tale for industry participants.
