Su Zhu and Kyle Davies, the controversial founders of the hedge fund Three Arrows Capital, allegedly bought a yacht with borrowed funds, according to a court document filed in the Singapore High Court for the recognition of British Virgin Islands winding-up proceedings. Supposedly, Davies wanted it to be bigger than any yacht a billionaire has owned in Singapore.
The two made a $50 million down payment even though their hedge fund was in bankruptcy proceedings, according to filing rumors. This also confirms previous rumors about Zhu bragging that he owns the yacht despite not having it in person. The yacht was scheduled to be delivered to Italy within the next two months.
As previously reported, rumors of 3AC’s insolvency began circulating in mid-June. In early June, the embattled hedge fund filed for bankruptcy after a court based in the British Virgin Islands ordered the company to be liquidated.
The court filing also shows that the hedge fund had approximately $600 million exposure to the Terra blockchain, that imploded in may. However, Zhu and Davies kept investors in the dark about the extent of their exposure.
In particular, they put 3AC into liquidation without informing any of the shareholders or creditors. He took a while to get in touch with his lawyers after the founders went dark.
Last week, US bankruptcy judge Martin Glenn froze the hedge fund’s assets in the country.
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