The CEO of Haru Invest was acquitted of fraud by the South Korean court.

The Nam Seoul District Court on Tuesday declared Haru Invest CEO Lee Hyung-soo not guilty in the fraud case related to the freezing of user withdrawals in June 2023. Previously, Lee was accused of raising thousands of investors with promises of capital and interest returns of up to 25% per year.

Initially, the prosecutor believed that Haru had embezzled 1.39 trillion won (, 1.02 billion USD) from 16,000 investors, but this figure was later adjusted down to 880.5 billion won (, 650 million USD) from about 6,000 people.

The court stated that Lee's actions did not constitute the elements of criminal fraud, despite the negligence in management. The main reason for the freezing of withdrawals is believed to be the collapse of the FTX exchange and the subsequent liquidity crisis.

Lee was stabbed 4 times in the neck during a hearing last year by an investor who lost 100 BTC, who then received a 5-year prison sentence.

The two CEOs of the parent company Blockcrafters have also been acquitted. Meanwhile, operations director Kang was convicted of embezzlement and sentenced to 2 years in prison.

The court emphasized that the ruling only exempts criminal liability, while civil liability to investors remains. Lee stated that he is looking for ways to mitigate the consequences through bankruptcy proceedings.