According to reports from The Block, Lee Hyung-soo, the CEO of the South Korean cryptocurrency yield platform Haru Invest, who was indicted on charges of fraud, was acquitted on Tuesday.
Haru Invest had attracted user deposits through high-yield products, suspended user withdrawals in June 2023, and closed its office, leading to dissatisfaction among multiple investors. Later, Haru was investigated by South Korean authorities, and three senior officials, including the CEO, were indicted for fraud.
According to local media reports, prosecutors initially claimed that Haru had stolen 1.39 trillion Korean won (approximately NT$30 billion) from 16,000 investors, but in subsequent indictments, the number of victims was reduced to about 6,000, with the amount involved lowered to 880.5 billion won (approximately NT$19 billion), and they requested a 23-year prison sentence for CEO Lee Hyung-soo.
According to reports from Digital Asset, the Seoul Southern District Court ruled on Tuesday that although Lee's management did exhibit significant negligence, his actions did not meet the legal standards for fraud as defined by criminal law. More specifically, the court found that the sudden suspension of the platform's withdrawal function was primarily related to the overall liquidity crisis triggered by the bankruptcy of the FTX exchange, and supported Lee's defense, stating that Haru operated a legitimate business model with actual returns, unlike other fraud cases.
In addition to Lee, Park and Song, co-CEOs of Haru's parent company Blockcrafters, were also acquitted. The company's COO Kang was found not guilty of fraud but was sentenced to two years in prison for embezzlement.
At the same time, the court noted that this ruling only absolved the defendants of criminal liability and did not exempt them from civil liability to the victims. Lee previously stated that he was working to recover losses through bankruptcy proceedings.
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