A South Korean court acquitted Haru Invest CEO Lee of fraud charges related to a $650 million case. The trial ensued after the firm halted all user withdrawals in June 2023.
Charges and Trial
Lee became embroiled in the case after Haru Invest suspended all user withdrawals and closed its office. The company promised annual returns of up to 25%, attracting thousands of investors. Initial prosecution charges alleged the company misappropriated 1.39 trillion won ($1.02 billion) from 16,000 victims, but this figure was later adjusted to 880.5 billion won ($650 million) from about 6,000 individuals.
Court's Ruling and Influencing Factors
In its ruling, the court pointed to external factors, including the collapse of FTX, as key contributors to Haru's liquidity crisis. The judgment also highlighted that Haru operated a business model that generated real profits, distinct from outright fraudulent operations. Prosecutors had sought a 23-year prison sentence, accusing Lee of orchestrating a high-yield fraud scheme disguised as a legitimate investment platform.
Consequences and Future for Investors
During his trial in August 2023, Lee survived a stabbing attack by a man who reportedly lost 100 BTC on the platform. The assailant was sentenced to five years in prison earlier this year. With the court's verdict, Lee avoids a lengthy prison term, though questions remain regarding investor compensation and the broader collapse of South Korea's yield platform sector.
The acquittal of Haru Invest's CEO raises questions about legal standards in the cryptocurrency investment space and the future of such platforms in South Korea.
