In an investigation into the sudden withdrawal suspensions, South Korean prosecutors have issued an arrest warrant for key individuals at Haru Invest, including its CEOs.
The virtual asset crime investigation unit of the Seoul Southern District Prosecutors Office has arrested three key individuals behind Haru Invest, as per the Yonnhap report.
Local officials have started probes into Haru and the cryptocurrency lending company Delio following their sudden pause of withdrawals on June 14, 2023.
Delio explained the suspension was a direct result of Haru Invest’s unexpected halt of deposits and withdrawals earlier the same day, a platform Delio had previously worked with.
Prosecutors in Seoul have charged the trio with looting cryptocurrencies valued at approximately 1.1 trillion Korean won ($826 million) from around 16,000 users, per the reports that reached South Korean authorities.
Authorities continue investigating Haru’s alleged misuse of client deposits. Haru advertised “risk-free” investing while concentrating deposits on one person. The investigation aims to uncover the full circumstances surrounding the sudden withdrawal suspensions.
The issuance of an arrest warrant signifies an intensified regulatory focus on cryptocurrency lending, spurred by several high-profile failures last year. This move reflects growing regulatory concerns over the sector’s stability and opaque practices, with global regulators seeking to enhance policies for greater consumer protection against the inherent risks of crypto lending.