The Monetary Authority of Singapore (MAS) has “reprimanded” cryptocurrency hedge fund Three Arrows Capital (3AC) for misleading information and ignoring assets under management (AUM) limits, the central bank said in a statement on Thursday.

See related article: Three Arrows Capital lines up for liquidation

Fast facts

• In August 2013, 3AC obtained its registered fund management company (RFMC) status which permitted a max AUM of SG$250 million (about US$179 million).

• 3AC exceeded its AUM limit from July 2020 to September 2020 and between November 2020 and August 2021, according to MAS.

• “[3AC] novated the management of the only fund it managed to an offshore entity in the British Virgin Islands on 1 September 2021,” the central bank said in its statement.

• While it resumed management of a portion of the fund’s assets in February 2022, 3AC notified MAS on 29 April 2022 of its intent to cease fund management activity in Singapore with effect from 6 May 2022, MAS added.

• This representation was misleading as 3AC and the offshore entity shared a common shareholder, Su Zhu, who is also a director of 3AC.

• 3AC also failed to inform MAS of changes in the shareholdings of its directors, Su Zhu and Kyle Livingston Davies, within the required timeline.

• The city-state’s central bank did not impose penalties on 3AC, but said it is assessing if there were further breaches by the company.

See related article: Contagion risk from Three Arrows Capital weighs on Bitcoin, crypto