Yield platform Haru Investment has fired 100 employees as it seeks to recover funds amid a lawsuit against service provider B&S Holdings.
The firm’s CEO, Hugo Lee, said Haru’s 100 layoffs come amid dwindling chances of full recovery while legal disputes mount.
Haru Layoffs Includes PR Staff
BeInCrypto’s request for comment from Haru’s public relations team was met with the following automated reply:
We have all been laid off. Please contact the company directly for your content.
The firm first announced plans to slim down its operations on June 22. Earlier, it sued service provider B&S for fraud, embezzlement, and other crimes that forced the pausing of withdrawals last week.
On June 13, the firm cited an issue with a business partner at the time but didn’t reveal additional details.
Haru’s Wallet product offers a 6% return, while the Earn Plus account offers 12% for Bitcoin (BTC), Ripple XRP, Ethereum ETH, and USDC investments.
In a June 20 blog post to customers, Lee apologized for the lack of communication. He said it was vital first to establish the scale of the damage B&S caused and develop a commensurate recovery plan.
Lee emphasized:
“Executives at Haru Invest, including myself, are fully cooperating with the authorities. I would like to emphasize that I am not evading this situation nor running away from it.”
Legal Disputes Could Reduce Payouts
Lee acknowledged that several customers had sued South Korean-based Haru, but he remained focused on recovering their funds.
Lawyers LKB & Partners represent 100 investors in a class-action lawsuit against Haru and its client Delio Investment. They seek damages worth $39 million from the two firms for allegedly conducting risky trades and abusing customer funds.
Meanwhile, the Haru customer said it would resume withdrawals without providing a method and timing. However, its customers could expect the company not to be able to fulfil its obligations on rates of return.
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Gemini engaged in arbitration with Genesis, the custodian of its Earn customers’ funds, after the latter filed for bankruptcy. It negotiated an 11% payout amid ongoing Genesis bankruptcy proceedings.
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