The Financial Services Commission (FSC) of South Korea is currently investigating Delio, a cryptocurrency loan company, as of June 30th.
Before suspending transactions earlier this month, Delio claimed it had no affiliation with Haru Invest, a struggling lending firm. The Commission accuses Delio of committing fraud, embezzlement, and breaching trust by unilaterally halting user deposits and withdrawals on June 14.
During an emergency meeting with investors on June 17, Jung Sang-ho announced that the company would resume withdrawals, albeit without providing a specific schedule.
The company began allowing withdrawals for some staking services on June 27. Sang-ho declared that Delio would secure as much capital as possible for compensation.
The company currently holds around $8.1 billion in various altcoins and an estimated $1 billion in Bitcoin (BTC), Ether (ETH), and other cryptocurrencies.
The Crypto Lending Firm holds the distinction of being one of the largest cryptocurrency lenders in South Korea. The CEO and executive team are prohibited from leaving the country while prosecutors investigate.
Delio’s sister company, Haru Invest, ceased accepting deposits and withdrawals on June 13 due to issues with a “consignment operator.” In response, Delio followed suit the next day due to counterparty risk.
Haru Invest has reportedly downsized its workforce significantly since the announcement and is pursuing legal action against its service provider. Delio is regulated by the government as a recognized virtual asset supplier (VASP) by the Financial Intelligence Unit.
However, Haru Invest is not a VASP subject to regulatory oversight. Delio’s management denied associating with Haru Invest before deciding to halt withdrawals.
