March 31, 2021

3rd Circular to Creditors
Dear Sirs,
Torque Group Holdings Limited (In Liquidation) (“Torque”)
BVI Company Registration Number: 2024611
I refer to the Circular dated 15 March 2021 (“2nd Circular”), in which the Provisional Liquidators provided creditors
an update on progress since their appointment and findings from their preliminary investigations.
Unless otherwise defined herein, capitalised terms used in this circular shall have the same meanings as thosedefined in the 2nd Circular.
The purpose of this circular (“3rd Circular”) is to provide creditors with an update on the Provisional Liquidators’
progress since the 2nd Circular and next steps.
A. Appointment of Joint Liquidators
On 18 March 2021, the Provisional Liquidators were appointed as Joint Liquidators (“Liquidators”) of Torquepursuant to an order of the Eastern Caribbean Supreme Court of the British Virgin Islands (“BVI Court”) dated 18March 2021 (“Order”) – this means that Torque is now in liquidation rather than provisional liquidation. A copy ofthe Court Order is now available and is enclosed (case number BVIHCCOM2021/0031).
B. Role and Responsibilities of the Liquidators
The roles and responsibilities of the Liquidators are set out in the British Virgin Islands (the “BVI”) Insolvency Act,2003 (“Act”) and as provided in the Order appointing them. Under section 186 of the Act, the Liquidators have all
the rights and powers to the extent necessary to maintain the value of the assets and to carry out the functions forwhich they were appointed. Additionally, as officers of the court, the Liquidators may apply to the BVI Court at any
time for directions with respect to matters arising in the liquidation.
Under section 178 of the Act, the Liquidators are required to advertise their appointment in accordance with theRules. Notices have been advertised in the Business Times in Singapore and the BVI Beacon and the BVI Gazette.

BORRELLI WALSH (BVI) LIMITED
3rd Floor, Commerce House
P.O. Box 3339
Road Town, Tortola VG1110
British Virgin Islands

www.borrelliwalsh.com

Creditors Meeting and Town HallPursuant to section 183 of the Act, Liquidators appointed by the Court are not required to call a meeting of creditors
unless 10 percent in value of the creditors of the Company give the Liquidators written notice requesting a meeting.
At this stage, the Liquidators do not intend to convene a formal liquidation creditors’ meeting where creditor claims
are first reviewed and assessed – this would be a costly and time-consuming process which would divert theLiquidators’ resources from its primary focus of investigation and recovering assets. A formal creditors meeting canoccur at a later stage when more is known about Torque’s assets.
Although a formal meeting is not proposed at this time, the Liquidators intend to convene a virtual town hall toprovide creditors an update on the liquidation and present preliminary findings that can be shared from ourinvestigations. In order for the creditors’ town hall to be as useful as possible, we require time to progress ourinvestigations – we will contact creditors with details of the town hall in coming weeks. Separately, the Liquidators
will continue to update all parties through circulars as and when meaningful progress has been made and material
events occur.
Preliminary report
Under section 226 of the Act, the Liquidators of Torque are required to prepare a preliminary report within 60days of the commencement of the Liquidation, covering, to the best of our knowledge, a description of the assets
and liabilities of Torque and possible claims under the Act. The report will be circulated to all of Torque’s
creditors and filed with the BVI Court. The Liquidator may apply to the BVI Court to extend the 60-day
period if that is necessary.
C.

Investigations Update

Legal strategy and Recovery options
As mentioned in the 2nd Circular, the Liquidators identified Crypto Assets that appear to have been transferredwithout proper authority by or at the direction of Torque’s former Chief Technology Officer (“CTO”), Wu Zhongyi(“Zee”). The Liquidators have been working with its legal advisors, Rajah & Tann Singapore LLP, in regard to legal
strategy and recovery options.
On 19 March 2021, a successful application was made to the General Division of the High Court of the Republicof Singapore for an Order of Court, which retrains Zee from disposing of, dealing with, or diminishing the value of
any of his assets whether they are in or outside Singapore, whether in his own name or not and whether solely or
jointly owned up to the value of USD 343.7 million (the “Mareva Injunction”).
Following the Mareva Injunction, the Liquidators have taken immediate steps to issue letters to all relevant
stakeholders giving notice of the Mareva Injunction, and to serve the Mareva Injunction on Zee himself.
Possible further claims, including against other parties, are being contemplated. The Liquidators will provide you
material updates when appropriate and where confidentiality permits - it is important that the Liquidators do notcompromise their investigation or potential routes to recoveries by disclosing certain recovery efforts publicly .
Tracing of Assets
The Liquidators’ continue to conduct significant Crypto Asset tracing activities – set out below are some high-level
updates on the Liquidators’ investigations:•Crypto Assets – working with Kroll Group’s cyber team, the Liquidators are in the process of reviewing
billions of transactions to establish the breakdown of leveraged trading losses compared tomisappropriated assets. As a part of this, Kroll’s cyber team is also investigating and tracing certain digitalwallets addresses that received material withdrawals from Torque’s Binance account; and•Relevant Parties – the Liquidators are also conducting investigations into Torque’s management andrelated parties to establish each of their deposits, withdrawals and any profit share from the Crypto Assets.

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D. Torque Personal Wallet
The Crypto Assets currently in the control of the Liquidators relate to Trading Wallet balances of Torque’scustomers. Separately, the Liquidators understand that Torque customers were able to have their Personal Wallet
Crypto Assets ‘hosted’ on Torque’s main application (website or mobile application). As a result of the freezing ofTorque’s application generally, and the insolvency of Torque, Torque customers’ access to these Personal Wallets
has been restricted. The Liquidators are currently working to resolve issues in respect of these Personal Walletbalances and will provide an update once it is able to.
E.

Common Questions and Answers

The Liquidators’ answers to common customers queries continue to be consolidated and issued to customers inCirculars or the Investor Q&A uploaded on Borrelli Walsh’s website at www.borrelliwalsh.com/creditors.
For any urgent customer,
torque@borrelliwalsh.com.

creditor

andmedia

Sincerely,
Philip Smith

Joint Liquidator
Torque Group Holdings Limited(In Liquidation)

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enquiries,

pleasecontact

theLiquidators

at:Investor Q&ANo.

Category

Question

Answer1

ClaimsWhen can I get my money back?

Torque has entered Liquidation and all
Torque user accounts will remain frozen

2

ClaimsWhat do I need to do to get mymoney back?

until all legal issues relating to them aredetermined.

3

ClaimsCan I withdraw my investment now?

The Liquidators are not legally capable

4ClaimsCan I still recover my money?

of repaying any Torque customers until
they have properly verified all 14,000

5Claims

What information do you need to
speed up my refund?

customer claims and completed at least
their preliminary investigations and theBVI Court directs distributions to bemade. Given the number of customers

6Claims

Is there a repayment scheme?

and the complexity of Torque’s business,these processes will be challenging.

7Claims

Are there any forms to fill in to
recover my money?

The Liquidators intend to provide an8910Claims

ClaimsClaims

How much are we expecting to getback from the liquidation?
Why can't I access or recover moneyfrom my personal wallet?
Torque management has promised to
repay all deposits from 8 and 9
February 2021.

Future Updates

What do I do now?

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Future Updates

Where will we receive updates fromnow on?

Future Updates

verifying creditor claims in comingweeks.
It is too early to predict with any
accuracy the timing or amount(s) ofdistributions to creditors. In the eventthat no further assets can be recoveredby the Liquidators from related parties orthird parties, a nominal distribution tocreditors may be possible during 2021.

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estimated timeline for securing / realising
Torque’s cryptocurrency assets andDo you have updates on thecompany?

However, in the event that theLiquidators investigations identify legal
claims and assets to recovery fromrelated or third parties that increase thereturn to creditors, this will involve
litigation across multiple jurisdictions andtake more time.
At this stage, it is too early to determine
the timing and quantum of any
distribution to creditors.
Regular updates ("Circulars") will be sent
via email and uploaded on to Borrelli
Walsh's website(https://www.borrelliwalsh.com/creditors/)

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1415

Future Updates

Liquidation

How do I sign up for the mailing
updates on the recovery process?

If you have not received the Circular via

What does a liquidation mean?

A company is placed in liquidation when
it is insolvent or when the Court

email, please contact us via
torque@borrelliwalsh.com to be added
into the mailing list.

determines it is just and equitable for thecompany to be placed into liquidation.
Refer to section 2) of the 2nd Circular forthe role and obligations of liquidators.
16Liquidation

Why is my money from Torque being
used to pay liquidator fees?

At this stage, the Liquidators have notused any of the Torque’s Crypto Assets
to pay liquidators’ fees.
However, as a matter of BVI Insolvency
law, liquidators are typically allowed touse company assets in order to pay theirreasonable and approved liquidation
fees and expenses.
This is a necessary mechanism to allow
an independent party who acts for thebenefit of all creditors to undertake thework necessary to collect a company’s
assets, investigate and pursue claims
and distribute recoveries to creditors.
The Liquidators are mindful that they areappointed by the Court with duties to theCourt and stakeholders.

17Liquidation

How long will this process take?

It is too early to determine how long theliquidation of Torque will take tocomplete. A liquidation of this size andcomplexity, that will likely involve
substantial litigation and asset recovery
work across multiple jurisdictions, will not
be a short process.
The Liquidators will provide an estimatedtimeline for securing / realising Torque’s
Crypto Assets and verifying creditor
claims as soon as practical andappropriate.
Regular updates ("Circulars") will be sent
via email and uploaded on to Borrelli

5Walsh's website(https://www.borrelliwalsh.com/creditors/)
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Investigations

Is this some kind of scam?

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Investigation

Is there any action being taken
against the offending former
employee?

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Trading

Will the company start trading again?

Refer to ‘Section F. Preliminary
Investigations’ of our 2nd Circular.

Torque ceased trading immediately on
the appointment of the Provisionalliquidators.
On the basis that Torque is clearly
insolvent (creditor claims currently
greatly exceed assets), absent amaterial change or a recovery of all or
substantially all of Torque’s missing
assets, it will not likely ever recommence
trading.

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