Three Arrows Capital provided false information to authorities
Three Arrows Capital is finally publicly falling apart as well according to the most recent press release of the Monetary Authority of Singapore, Three Arrows Capital provided false information and exceeded the assets under management threshold for the regulator and their investors.
The regulator's answer was an official reprimand issued to the fund, which is mot allowed to carry more than $250 million and have no more than 30 qualified investors. Obviously, Three Arrows Capital ignored the rule and attracted significantly more funds and investors. Last, but not least, is the prolonged breach of the abovementioned AUM threshold since TAC exceeded its management allowance of not more than $250 million, reportedly having more than $18 billion in management.
The reprimand is tied to the contraventions made by TAC that occurred prior to its notification of the regulator in April 2022. The fund notified MAS that it had changed the management structure of its fund to an unrelated offshore entity starting from September 1, 2021. However, the Monetary Authority notices that the representation was misleading and the fund shared a common shareholder, Zhu Su, which contradicts with 3AC's initial statement.
Additionally, 3AC did not notify the Singaporean regulator of changes to the fund's directorships and shareholdings. The fund did not informed the authority in the required timeframe, which is a direct violation of the regulator's rulings. The Monetary Authority of Singapore (MAS) said it had reprimanded Three Arrows Capital on June 30. “TAC had represented to MAS that it had novated the management of its fund to an unrelated offshore entity with effect from 1 September 2021. However, this representation was misleading as TAC and the offshore entity shared a common shareholder, Mr. Su Zhu, who is also a director of TAC. (Section 329(1) of the SFA).”
Some more overall information that summarizes some of their issues.
The central bank alleged that the beleaguered crypto hedge fund provided misleading information and also surpassed the assets under the management (AUM) threshold permitted for a registered fund management company (RFMC).
Furthermore, 3AC also did not notify the regulator regarding changes in the directorships and shareholdings of its directors within the required timeline, the MAS said.
The organization revealed that it will now investigate if 3AC was involved in any further breaches of its regulations.
Once a high-profile crypto entity and a darling of last year’s bull market, 3AC has run into difficulties following the sharp sell-off in the market in the past months.
It had been significantly invested in a number of troubled projects, including Terra.
Crypto broker Voyager Digital issued a default notice after 3AC failed to make payments on a loan of 15,250 BTC and $350 million worth of USDC.
The latest development comes after a British Virgin Islands court ordered the Singapore-based crypto hedge fund into liquidation.
