As a seasoned analyst with years of experience in the financial industry, I can’t help but feel a sense of disillusionment and sadness upon reading about yet another crypto fraud case in South Korea. The recent attack on Haru Invest CEO Hyungsoo Lee during his trial is a stark reminder of the raw emotions and desperation that often follow such incidents.
During a court hearing in South Korea on Wednesday, a disgruntled investor physically assaulted Haru Invest’s CEO, Hyungsoo Lee, as reported by local news outlets, who received information from individuals within the courtroom.
In the Seoul Southern District Court, Lee found himself fighting for survival as one of his $826 million crypto fraud victims lunged at him with a short knife, inflicting several wounds on his neck. The blade was around 20 centimeters in length.
Courtroom Drama Unfolds Amidst $826M Fraud Trial
Fortunately, prompt courtroom action managed to restrain the attacker, known only as Kang at that point. Later on, the CEO of Haru Invest was urgently taken to Korea University Guro Hospital for immediate medical attention. As of now, the outcome of the attack – whether the CEO survived or not – remains uncertain.
In my analysis, the striking spectacle underscores the rawness of the frustration and despair that many investors experience following significant financial losses from investments they considered legitimate.
On August 28th, I found myself among a group of six individuals observing a trial. However, as events unfolded, I felt compelled to take action personally due to the unresolved issues from the previous year. These problems stemmed from the hostile actions initiated by Haru Corporation and its leadership, who were involved in a theft scandal of approximately 1.1 trillion won ($826 million) that affected some 16,000 customers.
Haru Executives Misused Customers’ Funds
In February 2024, the CEO of the company, along with two other high-ranking officials, were taken into custody by the Special Task Force for Virtual Asset Crimes within the Seoul Southern District Prosecutor’s Office.
Approximately a couple of months following their arrest, the prosecution brought charges against the top management of Haru for allegedly misusing client funds spanning from March 2020 to June 2023. Despite promising “secure” and “diversified” investment plans, they stand accused of this misconduct.
Later on, Lee faced charges for fraud, specifically under the Aggravated Penalty Act for Economic Offenses. In the month of July 2023, he was granted bail, and his criminal court proceedings commenced not long after.
Crypto Crime in South Korea
In recent years, South Korea has seen a rise in instances of cryptocurrency-related fraud.
In just a few months following the Haru scandal, a significant South Korean exchange, V Global, found itself embroiled in another vast fraud incident. This time, approximately 50,000 individuals suffered losses totaling around $1.7 billion. Much like the Haru case, the executives at V Global enticed investors with guarantees of substantial returns, but instead, they absconded with the investment funds.
Later on, the CEO of the exchange, Lee Byung-gul, faced charges for fraud and was sentenced to serve a prison term of 25 years.
More recently, Do Kwon, a prominent figure in the cryptocurrency sector from South Korea, has been accused of fraud in the U.S. He, who used to head Terraform Labs, is facing multiple charges such as deceit in securities trading, deceit in commodity trading, and using wire communications fraudulently.
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2024-08-28 15:28