We've all heard the grumblings of so-called Crypto Twitter when a big fraud case breaks. We've seen the disgruntled crowds outside courtrooms and listened to the angry outcries of those who have been wronged. But a certain South Korean individual has just set a new bar for taking matters into one's own hands.
More: South Korean Criminals: Haru Invest Cryptocurrency Scandal
An unidentified man, described by local media as being in his 50s, stabbed Hyung-soo Lee, the CEO of Haru Invest, in the neck multiple times. The attack occurred during a court hearing regarding an alleged fraud case involving more than $800 million.
Hyung-soo Lee's injuries were not life-threatening, and he was promptly taken to the hospital for treatment. Authorities have stated that he is likely to make a full recovery.
The attacker has been arrested on charges of attempted murder, and the police are currently investigating his motives (though they are pretty obvious to everyone). It has been reported that the attacker was a former client of Haru Invest. While the exact amount of his financial loss remains unknown, it's clear it was significant enough to drive him to such a drastic, bloody action.
What’s the Story Behind the Scandal?
Haru Invest caught people's attention by advertising sky-high interest rates of up to 12% annually for depositing virtual assets. However, upon investigation, it was revealed that they invested most of the coins deposited by clients from March 2020 to June 2023. All the while, they falsely claimed to be "managing them steadily using a risk-free diversified investment technique." In total, they managed to collect deposits from around 16,000 clients.
Things took a sharp turn after June 2023 when the platform were suspended crypto withdrawals without any prior notice. After withdrawals were stopped on June 13, local media reported that the Haru Invest office in Seoul was deserted. According to Lee, employees were supposedly working from home "for their own safety."
Co-founder and former CTO Eunkwang Joo tried to reassure everyone on X, stating that although "Haru Invest was facing an internal situation, it was not a case where they were maliciously trying to deceive anyone."
But, really, who was he trying to fool with that statement when it was indeed a malicious deception?
소셜미디어 계정들이 다 닫히고 회사에서 공식 입장을 내놓지 않아서 유저분들은 답답하실 것 같은데요, 저도 퇴사는 했지만 유저의 한 사람으로서 답답한 심정을 동일하게 느끼고 있습니다.
— jooddang.eth (@jooddang) June 13, 2023
하루인베스트가 내부에 사정이 생기긴 했지만, 악의적으로 러그풀을 하려는 상황은 아닙니다.
After the suspension of withdrawals, the company shut down its office, and all its executives mysteriously vanished. Around the same time, Haru Invest also laid off approximately 100 employees.
Lee was one of three executives arrested for fraud in February this year, accused of embezzling cryptocurrency worth 1 trillion won (about 1.08 billion dollars). During the first court hearing in March, the courtroom was packed with victims who had lost their investments. Lee was released on probation last month.
Currently, the company is undergoing rehabilitation procedures.
How South Korea Protects Its Citizens from Unscrupulous Companies
This trial has made headlines not just because of the staggering amount of money involved but also because it unfolded during a period when South Korea was updating its laws to protect consumers better.
Worried about consumer rights in the cryptocurrency sector, the Korean government enacted a law in June 2023 to protect users' assets. This law came into force on July 19, 2024.
The "Virtual Asset User Protection Act" is designed to regulate unfair transactional activities, enforce stricter market oversight, and give more power to the Financial Services Commission (FSC).
This law replaces an earlier 2021 regulation, which the FSC admitted had its limitations. At the time, authorities were unable to respond effectively to various types of unfair transactions.
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The regulator also identified a regulatory gap in preventing harm to users stemming from the cryptocurrency market. The hope is that the new regulations will more effectively monitor and penalize virtual asset service providers while providing relief measures for victims.
Abimbola Adu
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