Haru Invest CEO arrested today with charges of massive fraud

Original link: https://www.digitalasset.works/news/articleView.html?idxno=5982

HARU INVEST CEO HUGO LEE ARRESTED TODAY WITH CHARGES OF MASSIVE FRAUD FOR $753M by South Korean prosecutors —————————————————— Three people, including the CEO of Haru Invest Hugo Lee, were arrested and imprisoned on charges of virtual asset fraud worth 1 trillion won ($753M).

On February 6, the Seoul Southern District Prosecutors' Office's Virtual Asset Crime Joint Investigation Team (Director Lee Jeong-ryeol) arrested Haru Invest co-representative Mr. Lee and 2 others on charges of stealing virtual assets worth approximately 1.1 trillion won from approximately 16,000 users (Special Police Act fraud). “The three people were arrested and imprisoned on February 5” the report reads.

The prosecution said: “They are accused of investing most of the virtual assets deposited by customers between March 2020 and June 2023 in specific individuals (making blind investments) and falsely advertising that they ‘are managed safely using risk-free diversified investment techniques.”

List of arrested people: Lee Hyung-soo (known as Hugo Lee, CEO of Haru Invest) - 40 y.o. Song Hoon - 40 y.o. Park Soo-yong - 44 y.o.

Haru was investigated by the prosecution after causing a suspension of large-scale virtual asset deposits and withdrawals with Delio in June 2023.

On February 6, the Seoul Southern District Prosecutors' Office's Virtual Asset Crime Joint Investigation Team (Director Lee Jeong-ryeol) arrested

Haru's co-representative Mr. Lee and others on charges of stealing virtual assets worth approximately 1.1 trillion won from approximately 16,000 users (Special Police Act fraud).

“The three people were arrested and imprisoned on February 5,” he said. The prosecution said, “They are accused of investing most of the virtual assets deposited by customers between March 2020 and June 2023 in specific individuals (making blind investments) and falsely advertising that they ‘are managed safely using risk-free diversified investment techniques.’” explained.

Haru Investors on June 13, 2023, a sudden notice was posted to suspend deposits and withdrawals, causing numerous losses. At that time, immediately after the announcement, the office in Gangnam-gu, Seoul was closed, surprising users.

Afterwards, another depository company, Delio, also claimed, “Delio has nothing to do with the one-day deposit/withdrawal suspension,” but it led to a similar situation. A day after the explanation, Delio admitted, “There were virtual assets deposited in one day, and deposits and withdrawals are suspended due to one day.”

On June 16, the victims filed a complaint against key executives of Haru and Delio to the Seoul Southern District Prosecutors' Office on charges of fraud and other charges, and the prosecutors began an investigation. The prosecution continued its investigation by banning key suspects, including executives and employees, from leaving the country .

The prosecution said, “We will thoroughly investigate the truth through a detention investigation and do our best to recover the damage suffered by the victim and recover the proceeds of crime.”

Comment: Hugo Lee provided email update with no specific details yesterday to investors, perhaps this was a surprise even for him. Right now it’s still noon/afternoon in Korea, so it happened just this morning perhaps. It is likely the number $753M is an overshoot and perhaps the total number of assets (customer + corporate) which prosecutors managed to count.

Some criticism on the credibility of the article by local Korean sources: “There is no way the prosecution would have used the expression, “I’m a fool,” and Digital Asset reporter Park Beom-soo is the reporter who writes the LKB article.” Article is based on official press release by prosecution and is also verified by Naver reporter too (top news company in S. Korea).