Singapore police charged former Hodlnaut CEO Zhu Juntao with six counts of fraud by false representation on May 26.
Summary
- Singapore police charged former Hodlnaut CEO Zhu Juntao with six fraud counts tied to UST claims.
- Police said the alleged statements denied direct UST exposure and losses after Terra’s 2022 crash.
- Related reports show Hodlnaut previously faced claims of $190 million in UST-linked losses.
The Commercial Affairs Department led the investigation into the now-defunct crypto lender.
Zhu, 36, faces three charges under Section 424A(1)(a) read with Section 424A(3) of Singapore’s Penal Code. He also faces three further charges under the same provisions read with Section 109.
TerraUSD claims sit at the center of the case
Police said the case relates to statements made after TerraUSD crashed in May 2022. Zhu allegedly instigated Hodlnaut employees to make “misleading statements” in the company’s Telegram group and in emails sent to some users between May and July 2022.
Those statements allegedly said Hodlnaut had no direct exposure to UST and did not suffer losses from the crash. Police also said Zhu published three similar posts on his personal Twitter account, now X, in June 2022.
Hodlnaut’s 2022 collapse returns to focus
Hodlnaut allowed users to deposit digital tokens and earn interest. Police said the platform had more than 30,000 users worldwide before it became defunct in August 2022 following financial difficulties.
As previously reported by crypto.news, Singapore police had been looking into Hodlnaut since 2022 over fraud and deception claims tied to Terra/Luna exposure. That report said previous sources claimed Hodlnaut lost close to $190 million from the UST meltdown and had about $18.5 million parked at FTX.
Hodlnaut’s financial stress had already reached Singapore’s courts in August 2022. As crypto.news reported, the lender applied for judicial management after halting withdrawals, seeking court protection while it tried to handle a liquidity crisis.
Judicial management gave the company temporary protection from creditor claims. The move came during a wider crypto lending crisis after Terra’s collapse, which also hit several firms across the digital asset market.
Singapore keeps pressure on crypto firms
If convicted, Zhu faces up to 20 years in prison, a fine, or both, for each charge. Police also warned the public about risks tied to crypto products and service provider failures.
The case comes during a tougher period for crypto oversight in Singapore. crypto.news reported last week that the Monetary Authority of Singapore revoked Bsquared Technology’s major payment institution license after finding false or misleading information, weak risk controls, and outsourcing failures.
