Three Arrows liquidators seek $40m from co-founder’s wife over Dubai property sale
Liquidators for collapsed crypto hedge fund Three Arrows Capital (3AC) are pursuing legal action against the wife of co-founder Zhu Su in a bid to recover approximately $40m from the sale of a Dubai property they allege was acquired using misappropriated fund assets, according to a report by Business Times.
The liquidators of defunct crypto hedge fund Three Arrows Capital (3AC) are taking legal action against Zhu Su's wife to recover approximately $40m, alleging the funds came from misappropriated assets, according to Business Times. They claim Dr Evelyn Tao Yaqiong received a villa in Dubai in 2022, purchased for AED110m ($30m), with funds linked to a $50m cryptocurrency loan to Zhu from 3AC just before the fund's liquidation amid the crypto market's collapse.
The property was later sold in January 2024 for AED146m ($40m), generating the sought-after proceeds. Liquidators argue the property transfer in October 2023, while Zhu was in prison for contempt of court, was made without payment to shield the asset from creditors. They assert Zhu failed to disclose the property during the liquidation process, intending to frustrate creditors' asset recovery.
Dr Tao denies the allegations, maintaining she had no knowledge of any asset misuse or breach of duty by Zhu and believes the property was a gift, intended for their family's relocation to Dubai. She also contests the transfer's inconsistency with their deteriorating relationship, which wasn't formalized until January 2024. This lawsuit is part of the liquidators' broader campaign to recover over $1.3bn from 3AC co-founders, with ongoing interim distributions as funds are recovered during the liquidation process.
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