Haru Invest (Haru), the crypto return investment platform, is considering shutting down servers to cut costs. The company wants to reduce overhead costs until it can compensate its customers through bankruptcy proceedings.
According to Haru CEO Hugo Lee, the investment company will secure its servers to avoid loss of customer information. Communications systems critical to the smooth transfer of client assets are maintained for as long as possible.
Haru delays reducing communication costs
Lee confirmed in an October 16 announcement:
“We expect the costs of communicating with members to be incurred on an ongoing basis until we distribute members’ assets (although it is difficult to predict when this will occur), so our plan is for this to be the final point should be something we can save on.”
He added that the company will update customers as cost-cutting plans become clearer. Earlier this year, the company laid off 100 employees to cover litigation costs.
The company served customers in 140 countries before suspending withdrawals on June 13. Lee later revealed that Haru was taking legal action against B&S Holdings, a service provider he said was the reason for the suspensions.
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The asset freeze affected Delio Investments, a South Korean lender, which decided to invest client funds in Haru. Following the suspensions, a group of Haru customers filed a class action lawsuit, accusing the platform of conducting risky trades and misusing customer funds.
Frustrated Haru customers are angry about delays
Haru customers mocked the platform’s latest cost-cutting plan, arguing it was pointless. Shutting down a server could cut operating costs by at most $200 without speeding up the return of customer funds, one person said.
Others, like Ronald Blinks, have come to terms with the fact that they may never see their money again.
“Nobody gets their money back, at least not in 2 years and not 100%.”
One hopeful who calls himself Seng argued that if Haru’s situation wasn’t as dire as that of FTX, which has a $7 billion to $8 billion hole in its balance sheet, the chances of a refund could be “more positive” than ” initially accepted”. ”
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Several community members criticized Haru’s infrequent communication, a frustration that may have started since the platform suspended withdrawals. Lee waited a week before disclosing the reason for the suspensions and has not provided a specific plan for bankruptcy.
But those unhappy with his leadership may have no choice but to wait. South Korea’s revised bankruptcy law in 2006 allows the incumbent CEO to become a bankruptcy trustee.
Number of bankruptcies South Korea | Source: TradingEconomics
Under the previous arrangement, the manager was forced to resign and hand over management to a restructuring expert.
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