In summary
- On Wednesday, Haru Invest CEO Hugo Hyungsoo Lee was stabbed multiple times in the neck while attending his trial for allegedly swindling more than $800 million.
- Lee was immediately taken to hospital and his injuries were not life-threatening; the attacker was a former client of Haru Invest.
- The trial is high-profile and comes as South Korea updates its laws to protect Cryptocurrency consumers.
On Wednesday, the CEO of cryptocurrency firm Haru Invest was attacked in South Korea while attending his trial for allegedly scamming more than $800 million.
Hugo Hyungsoo Lee was stabbed multiple times in the neck by a man described by local media as being in his 50s and was immediately taken to hospital for treatment.
The injuries he sustained were reported to be non-life-threatening. The attacker is said to have been a former client of Haru Invest.
The trial is high-profile, not only because of the large amount of money involved, but also because it occurred at a time when South Korean laws were being updated to protect consumers.
Lee was one of three executives arrested for fraud in February this year on charges of embezzlement involving 1 trillion won in cryptocurrency.
According to prosecutors, the executives were accused of receiving deposits from around 16,000 clients between March 2020 and June 2023 and then investing them in full, allegedly falsely advertising that they were “operating them stably using a diversified risk-driven investment technique.”
Haru Invest was advertising annual interest rates of up to 12% for cryptocurrency investments to its clients. However, after June 2023, cryptocurrency withdrawals were suspended without any prior notice.
Concerned about the consumer protections available with cryptocurrencies, the Korean government passed a law in June 2023 to ensure the protection of assets held by users. The law was enacted a year later.
The Virtual Asset User Protection Act also aims to regulate unfair trading activities, provide greater market oversight, and grant authority to the Financial Services Commission.
The law replaced an earlier ruling from 2021 that the FSC acknowledged had limitations where authorities could not respond to what it considers to be various types of unfair transactions.
The regulator also identified the regulatory gap as an impediment to preventing harm to users arising from the cryptocurrency market. The hope is that the new regulation will more effectively monitor and sanction virtual asset service providers and assist victims with relief measures.
Edited by Sebastian Sinclair
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