Haru Invest execs grounded in South Korea amid fraud suspicions
South Korean prosuectors said the ban is a preemptive measure.
South Korean prosecutors have barred Haru Investment executives from traveling out of the country following criminal complaints of “serial suspending withdrawals” fraud, according to a Digital Asset June 25 report.
The ban affects unnamed executives from Haru Invest, Delio Chung Sang-ho’s CEO, and a B&S shareholder identified as Bang.
Why travel restrictions
The travel ban is coming after Haru Invest suspended withdrawals for users on June 13, citing false information from an unnamed consignment operator.
Investors were spooked after the firm closed its office in Seoul, with community members noting that the company deleted its YouTube and LinkedIn profiles. These actions led to speculations of fraud and suspicions of a rug pull—a claim viciously denied by the firm.
Meanwhile, its unnamed consignment operator has been revealed to be the renewable energy company B&S Holdings. Its shareholder Bang was placed on travel restrictions after prosecutors connected him to Haru’s transaction activity suspension.
While Delio CEO Chung Sang-ho initially denied exposure to Haru, he later confirmed that they deposited crypto assets in the troubled firm. On June 14, the crypto lending platform temporarily halted withdrawals to protect customers’ assets.
South Korean investigators are reportedly investigating Delio for embezzlement and breach of duty.
Not a Rugpull
A former executive of Haru Invest and its co-founder, Eunkwang Joo, has defended the company against insinuations of the rug pull.
In a June 13 Twitter thread, Joo said the issues at Haru were only an internal problem, adding that “it is not a situation where they are maliciously trying to do a rug pull.”
However, he conceded that the firm’s closure of its social media accounts without further official communications would leave many investors concerned.
Joo left the company more than a year ago.
Since suspending its withdrawal and deposit activities, the firm has laid off over 100 employees.
CryptoSlate has reached out for comment from Haru Invest executives known to the company.