Su Zhu Faces Court Questioning Over Three Arrows Capital Collapse
Su Zhu, the co-founder of Three Arrows Capital (3AC), recently appeared in a Singapore court for questioning related to the collapse of his firm. The court session, held privately, aimed to uncover the reasons behind the fund’s failure and locate any remaining assets. Zhu’s arrest at a Singapore airport on September 29 led to his detention for four months due to non-cooperation with the liquidation process. However, he is expected to be released soon, pending good behavior.
Three Arrows Capital’s Downfall and Legal Troubles
Once a prominent player in the crypto hedge fund space, 3AC experienced a significant decline after Terra’s LUNA crash in 2022. The firm filed for bankruptcy in July, leaving approximately $3.5 million in debt to its creditors. Following the bankruptcy, the fund’s management allegedly avoided court summons and engaged in online disputes with the liquidators instead. Some creditors have accused the company of misleading investors and fraudulent activities.
Monetary Authority of Singapore Imposes Prohibition Order
In response to violations of securities laws, including the Securities and Futures Act 2001 (SFA) and Securities and Futures (Licensing and Conduct of Business) Regulations (SFR), the Monetary Authority of Singapore (MAS) issued a nine-year prohibition order against the founders of 3AC. This order effectively prohibits them from participating in regulated activities or holding management positions in any capital market entities governed by the SFA.
Hot Take: The Legal Battle Continues for Su Zhu and Three Arrows Capital
The ongoing legal proceedings surrounding Su Zhu and Three Arrows Capital paint a picture of a once-prominent crypto hedge fund facing its downfall. With the court questioning Zhu and the allegations of fraudulent activities, the true reasons behind the firm’s collapse may soon come to light. As creditors seek justice and regulators impose sanctions, the outcome of this case will have implications for the wider crypto industry. It serves as a reminder of the importance of transparency, compliance, and responsible management in the rapidly evolving world of cryptocurrencies.
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