Haru Invest, a struggling South Korean crypto yield platform, made headlines recently as it terminated contracts for over 100 employees. In a statement released on Thursday, the company announced its decision to minimize operations in order to prevent further damages.
According to local news outlet Sedaily, the contract terminations were initiated by Haru Invest, the operator of the crypto management service Haru, as well as the parent company Block Crafters. While the exact number of employees affected was not disclosed, CoinDesk Korea reported that it was over 100 individuals. The company held a video conference on the day of the contract termination to inform the employees about the decision.
The troubles for Haru Invest began earlier this month when it paused withdrawals and deposits on its platform. It cited problems with service partners as the reason for the halt. Subsequently, the company closed its offices and allowed its employees to work from home, while the officials remained inaccessible.
In a post addressing the situation, Haru Invest stated that its executive team is dedicated to resolving the issue and providing legal responses regardless of location. The company also promised to offer administrative and legal support to its team members when necessary.
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During the video conference, CEO Lee Hyung-soo expressed that it had become difficult to operate normally due to the recent situation. The company discovered that certain information provided by a consignment operator was suspected to be false during an internal inspection process. Further investigation revealed issues with the external management company, B&S Holdings, which Haru subsequently announced legal action against.
The company emphasized in a post on June 22 that it was prioritizing the recovery of damages and confirmation of facts through legal action against B&S Holdings. However, Haru Invest remained unable to disclose additional information regarding the ongoing legal proceedings.
In addition to facing legal challenges from B&S Holdings, Haru Invest has also encountered legal action from users of its platform. CEO Lee stated that the company will fully cooperate with the authorities to ensure that the facts are swiftly and accurately identified, and that their position is represented based on the findings.
Despite the internal situation, Haru co-founder and former CTO Eunkwang Joo clarified on Twitter that it was not a case of rug pull. While the company is certainly facing difficulties, Joo’s statement suggests that the situation is more complex than a simple exit scam.
This recent development has raised concerns about the stability and credibility of Haru Invest and its affiliated companies. Users of the platform may be worried about the security and reliability of their investments, considering the legal troubles and contract terminations.
It remains to be seen how Haru Invest will navigate through these challenging times and regain the trust of its users. In the cryptocurrency industry, where scams and fraudulent activities are becoming increasingly common, it is essential for platforms like Haru Invest to take swift and transparent actions to address any issues that arise.
As the investigation and legal proceedings continue, the crypto community will be closely watching the outcome and its impact on the industry as a whole. This incident serves as a reminder for investors to research and choose their investment platforms wisely, ensuring that they prioritize security, reliability, and transparency.
