The Monetary Authority of Singapore (MAS) Imposes 9-Year Prohibition Orders on Zhu Su and Kyle Davies of Three Arrows Capital
The Monetary Authority of Singapore (MAS) has issued prohibition orders against Zhu Su and Kyle Davies, who were associated with Three Arrows Capital (3AC). The orders were issued as a result of their violation of Singapore’s Securities and Futures Act. The prohibition orders prohibit Zhu and Davies from engaging in any regulated financial activities in Singapore for a period of nine years. Additionally, they are banned from holding management or leadership positions in capital market services firms.
Investigation Reveals Multiple Violations
MAS conducted an investigation into Three Arrows Capital after previously reprimanding the firm in June 2022. The investigation revealed additional violations, including providing false information, failure to report new employees to MAS, and inadequate risk management practices. Zhu and Davies, as directors of 3AC, were found responsible for these breaches and were deemed to have failed in their duties to ensure compliance with regulatory requirements.
Failure to Report Employment of Portfolio Manager
MAS specifically highlighted the failure to report the employment of portfolio manager Cheong Jun Yoong Arthur between August 2020 and September 2021. Loo Siew Yee, MAS Assistant Managing Director, emphasized the importance of senior management implementing robust risk management measures to protect investors’ interests. MAS expressed its strong disapproval of Zhu’s and Davies’ disregard for regulatory requirements and dereliction of their duties as directors.
Rebranding as 3AC Ventures
In June, Three Arrows Capital reemerged as 3AC Ventures after filing for bankruptcy in June the previous year. The rebranding announcement was made by OPNX (Open Exchange), a claims exchange co-founded by Zhu and Davies. The liquidators of 3AC are currently seeking to recover $1.3 billion from the co-founders.
Hot Take: MAS Sends a Strong Message to Senior Managers
The prohibition orders imposed by MAS on Zhu Su and Kyle Davies of Three Arrows Capital demonstrate the central bank’s commitment to upholding regulatory requirements and protecting investors. By holding senior managers accountable for their misconduct, MAS sends a strong message that non-compliance will not be tolerated. This enforcement action serves as a reminder to the crypto industry that adherence to regulations and robust risk management measures is essential for maintaining trust and integrity in the financial system.
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