REGULATION

MAS rebukes Three Arrows Capital for providing false information and exceeding asset limits, revealing investigation from last year

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MAS rebukes Three Arrows Capital for providing false information and exceeding asset limits, revealing investigation from last year

The Monetary Authority of Singapore (MAS) today (30) issued a "reprimand" to Three Arrows Capital (3AC), a Singapore-registered company that has recently caused a stir in the cryptocurrency industry.

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The Monetary Authority of Singapore (MAS) today issued a "Reprimand" to 3AC, a Singapore-registered company in the cryptocurrency industry that has recently caused a stir.

MAS stated that TAC, the registered company of Three Arrows Capital, provided false information to MAS and exceeded the assets under management (AUM) threshold allowed for Registered Fund Management Companies (RFMC).

The announcement indicated that Three Arrows Capital obtained RFMC qualification in August 2013, allowing it to conduct fund management business with no more than 30 eligible investors and manage assets not exceeding SGD 250 million or USD 180 million. In September 2021, Three Arrows Capital transferred fund management rights to an offshore entity in the British Virgin Islands, partially resumed asset management in February 2022, and informed MAS in April this year that it would cease fund management activities in Singapore from May 6, 2022.

MAS stated that it reprimanded Three Arrows Capital for its violations of the Securities and Futures Act before April this year and has been investigating since June 2021. Specific issues include:

  • Not providing MAS with correct information, as even though the fund management rights were transferred to an overseas entity last September, Su Zhu remains a common shareholder of the two companies.
  • Not informing MAS of changes in the company's directors and shareholding, including Su Zhu and another founder, Kyle Livingston Davies.
  • Long-term violation of the AUM threshold, exceeding the SGD 250 million limit between July and September 2020, as well as between November 2020 and August 2021.

MAS also raised concerns about Three Arrows Capital's ability to meet fund management obligations and is assessing whether there are any other violations.