Dear Haru Invest Members,
As we announced last week, we provide weekly updates to keep you informed.
We would like to reiterate that it is expected to take some time to make progress on the key issues below, and we will provide you with more specific details once we have any updates.
1. Investigation into B&S holdings: as we communicated last week, we have learned through the media that seizure and search were conducted on B&S holdings, and no further updates have been made so far.
2. Recovery of assets: we are continuously communicating with asset managing partners at home and abroad and making every effort to recover those assets under management.
3. Sale of company’s assets: we are drawing a list of potential salable company assets and considering the sale with a minimum loss of value from a long-term perspective.
4. Distribution of customer assets: we are organizing a database to clarify the credits and debts. Once we can confirm the size of losses and finalize the asset distribution plan, we plan to distribute those assets in phases in time for the recovery of the assets. It is very difficult to say when we can exactly start the distribution with the limited information we have on the exact size of losses.
In addition, we have summarized some of the questions we have received through various channels in the FAQ below.
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Q1. How many assets does Haru currently hold? Or how many assets have been returned, or what is the confirmed size of the assets to be returned?
> First, we would like to ask for your understanding that we are treading this very carefully to avoid any confusion caused by the predictive information we provide, especially when the size of recoverable assets has NOT been fully finalized yet. As previously communicated, we are in the process of recovering assets, and we aim to recover them in a few weeks with a minimum loss.
Q2. Do you have any plan to compensate using the company’s internal assets before the B&S holding case is resolved?
> Since we have not fully identified the exact size of recoverable assets from B&S holding, it is difficult to pursue compensation as we have to consider the range, compensation ratio, and fairness among our users. However, we are considering such a plan to prepare in case the recovery of assets under B&S holdings takes longer. In this regard, we are organizing a database to clarify the credits and debts and reviewing an asset distribution plan as well.
Q3. Haru Invest announced that only B&S holding is up with a problem. If so, what is the ratio of invested assets to B&S holdings? If this question cannot be answered, we would like to know why this cannot be answered despite the fact that this is what we are most curious about.
> We fully understand that the answer to this question is the most curious and frustrating part for our customers. However, since the official authorities are investigating the case, it may take some time to provide you with fact-proven information, and we ask for your understanding and patience in this matter. At this time, Haru Invest and I believe that the most important part is to fully cooperate with the authorities to ensure that the investigation is going in the right direction so that we can minimize the percentage of losses. So once again, we ask for your understanding that the information we can provide is limited with the investigation still ongoing.
Q4. CEO said that losses are different for each product. Then, will there be any differences in the distribution plans for Earn Plus and Earn Explore? Does this mean that losses incurred to Earn Explore are bigger?
> What I meant by losses is different for each product. I did not mean to imply that certain products have more significant losses. What I meant is that there could be some differences depending on the products since every product has different terms and conditions.
Q5. If Earn Explore has a bigger loss, does the compensation plan consider the deposits and profits of each product and take the different situations of various individual investors into account?
> We still need to set up a compensation plan for each product. We will provide you with details once we have further updates.
Q6. I have failed 2FA due to Haru Invest App or web system error, and as a result, my account is locked. Can this be fixed? Also, can you unlock the lock-up on Earn Plus and Earn Explore for those who wish to unlock them? According to the system, it seems that earnings are being paid, and is this correct? Or is this an error?
> After we suspended the deposit and withdrawal service, we have suspended all operations, restricted access to the company’s assets and accounts, and terminated the contracts of our entire staff. We have taken these measures for two main purposes:
1) to prevent damage and loss of assets and data related to other than B&S holdings
2) to minimize operating costs to preserve the loss of customer assets
To achieve these two purposes, we have minimized our operation resources, and Haru Invest is operating with minimal costs. This makes it difficult for us to accommodate every individual customer request. Besides, on a more fundamental note, we are trying to avoid any contrived development efforts to ensure accurate data management for customer asset distribution in the future.
Once we have completed our customer asset database, we expect to resolve those issues, such as locked accounts in time for the asset distribution.
In addition, since the amount of customer assets is determined based on a specific point of time in the database after the suspension of deposit and withdrawal last month, we would like to inform you in advance that any system errors or additional transactions, such as earning payment may not be included in the customer asset database in the future.
Q7. After the layoff, how many staff are left at the company, and what are their roles?
> We have terminated the contracts of most of our employees as of the end of June. A few executive members, including myself, have worked on 1) recovering customer assets (responding to cooperation requests for the investigation) 2) freezing, selling, and liquidating company assets. From this week, we are preparing to 1) organize a database to identify customer credits and debts, 2) organize and preserve returned assets and 3) establish a plan for asset distribution. Due to the sudden suspension of our operation and an asset freeze, making a corporate expense is challenging. As a result, we are faced with difficulties in carrying out even basic communication (translation/interpretation/website management).
Despite all that, we are fully aware of the severity of the situation and are making our utmost effort to minimize our workload and avoid any asset outflow.
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Many individual users and representatives abroad are contacting us. We ask for your understanding that we are unable to reply to your inquiries in a timely manner. We will do our best to provide answers to common questions through our regular email updates.
For any other additional questions, please email us, and we will try to put them into FAQ so we can share them with other users.
Haru Invest
CEO Hugo Lee