A South Korean court has cleared Haru Invest CEO Lee Hyung-soo of fraud charges tied to the platform’s abrupt shutdown and massive investor losses in 2023.
The Seoul Southern District Court ruled on Tuesday that while Haru’s failure caused significant financial damage, Lee’s conduct did not meet the legal definition of fraud under criminal law.
Prosecutors Had Sought 23-Year Sentence
Lee stood trial after Haru halted all user withdrawals in June 2023 and shuttered its office without prior notice. The firm had promised annual returns of up to 25%, drawing in thousands of investors. Initial charges alleged the company misappropriated 1.39 trillion won ($1.02 billion) from 16,000 victims. That figure was later revised to 880.5 billion won ($650 million) from roughly 6,000 individuals, according to Newsis.
Prosecutors requested a 23-year prison sentence, accusing Lee of orchestrating a high-yield fraud scheme masked as a legitimate investment platform.
Court Cites FTX Collapse and Operational Evidence
In its ruling, the court pointed to external factors—including the FTX collapse—as key contributors to Haru’s liquidity crisis. The judgment also highlighted that Haru operated a business model that generated real profits, distinguishing it from outright fraudulent operations.
According to Digital Asset, the court acknowledged serious management negligence but found no sufficient grounds for criminal intent or deception.
Violent Incident and Aftermath
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 Tuesday’s verdict, Lee avoids a lengthy prison term, though questions remain about investor compensation and the broader collapse of South Korea’s yield platform sector.
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Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/south-korean-court-acquits-haru-invest-ceo-of-fraud-in-650m-case/