GIC, a sovereign wealth fund in Singapore, has reduced its exposure to H2O Asset Management after the French regulator’s sanctions against the fund manager, reported the Financial Times.

Last month, a penalty of €75m was imposed on the fund manager for “serious” regulations violations involving its illiquid investments related to financier Lars Windhorst.

Apart from monetary fine, the regulator also barred its founder Bruno Crastes from managing funds for five years.

H2O is said to have added over €30bn in assets from thousands of retail investors across Europe.

It also managed billions of euros on behalf of sovereign wealth funds, with  GIC and the Abu Dhabi Investment Authority (Adia) being its two largest fund investors, people with knowledge of the company’s client base told the FT.

The French fund manager managed $4.19bn of assets on behalf of sovereign wealth funds, according to the company’s last year US regulatory filing.

The Singaporean wealth fund, which till now was reviewing its investments with H2O, has now decided to start withdrawing its funds, the sources further revealed.

However, GIC may withdraw its investment in phases.

H2O Asset Management refused to offer any comment on the report.

In its response, H2O said: “As a matter of policy, H2O AM Group never has and never will communicate on the identity of its investors. This is strictly confidential information and thus the group is unable to confirm, deny or provide any guidance.”

Sovereign wealth funds GIC and Adia also refused to give any comment.

The French fund manager is also being probed by the UK’s Financial Conduct Authority and is also dealing with legal action brought by over 3,000 clients in France.