Former Chief Executive Officer (CEO) of now-defunct cryptocurrency platform Hodlnaut, Zhu Juntao, was charged in court on Tuesday (26 May) for fraud by false representation.
Hodlnaut was a Singapore-based lending and borrowing platform that used cryptocurrency.
The 36-year-old had allegedly instigated his former employees to make “misleading statements” in the company’s Telegram group chat and official emails that were sent directly to users.
After the price crash of TerraUSD (UST) in early May 2022, Mr Zhu had allegedly made his former employees send out “misleading statements” through the company’s official Telegram group chats.
Source: Georgescu Adrian’s Images on Canva. Image for illustration purposes only.
They were also tasked to send these statements in official emails that were sent to some of its users between May and June 2022.
“These statements allegedly asserted that Hodlnaut did not have direct exposure to UST and/or did not suffer losses arising from the crash of UST,” the Police said in a press release.
The CEO had also made three posts on his personal X account in June 2022 that contained similar allegedly misleading statements.
Mr Zhu will be facing three charges, and if convicted, shall face imprisonment of up to twenty years, a fine, or both.
Source: Pixabay on Canva. Image for illustration purposes only.
The Police urge members of the public to remain aware of the risks that come with cryptocurrencies.
“Cryptocurrencies are volatile and speculative in nature, and do not carry any underlying or fundamental value,” they said in the statement.
“Dealing in cryptocurrencies is highly risky and not suitable for the general public, who also face the risk of service providers collapsing due to fraud.”
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Featured image adapted from Georgescu Adrian’s Images and Pixabay on Canva.