3AC Co-Founder Kyle Davies Has Abandoned US Citizenship, No Need To Answer US Courts
- Kyle Davies, co-founder of Three Arrows Capital, said he has given up his US citizenship, so there is no need to respond to a request from a US Court.
- 3AC’s liquidators last month demanded $1.3 billion from co-founders Davies and Su Zhu.
- Previous court documents stated that the two co-founders ignored most of the liquidators and refused to cooperate.
According to Decrypt, Kyle Davies, co-founder of collapsed crypto hedge fund Three Arrows Capital (3AC), said he has renounced his US citizenship and therefore does not need to respond to US courts.
In court documents on Tuesday, Davies said he became a permanent resident of Singapore in 2017. Since Singapore does not allow dual citizenship, he renounced his US citizenship after his marriage and, therefore, not within the jurisdiction of the courts of the United States. He also added a copy of his Singapore passport to the court filings to bolster his argument for renouncing US citizenship.
The move comes after months of efforts to get Davies and Su Zhu to cooperate with their failed hedge fund liquidation attempt and return billions of dollars to investors. British Virgin Islands liquidators bring companies with assets in the British Virgin Islands into Chapter 15 bankruptcy protection in the United States to benefit from legal shields against creditors due to bankruptcy produced in the United States.
The liquidators and judges have unusually extended the subpoenas against the two founders but have received no response. After failing to respond to the subpoena, 3AC’s liquidators’ attorneys asked to hold Kyle Davies for contempt of court, which could land him fines of $10,000 per day until he pays.
However, US financial regulators and criminal prosecutors can still bring enforcement actions or pursue indictments against foreign nationals believed to have committed crimes in the United States or connection with residents or entities of the United States.
As previously reported, three Arrows Capital liquidators are looking to recover $1.3 billion from founders Su Zhu and Kyle Davies. The two founders allegedly made Three Arrows use significant leverage between May and June 2022 after the fund suffered massive losses on LUNA tokens and other investments.
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