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Singapore’s white-collar crime unit is investigating Hodlnaut, a local cryptocurrency lender under court protection from creditors, on allegations of fraud, according to a statement on the website of the Singapore police dated Nov. 23.
See related article: Singapore’s central bank says not possible to protect local users from FTX fallout
Fast facts
- The police Commercial Affairs Department that handles white-collar crime said they received multiple reports between August and this month alleging Hodlnaut and/or its directors had made false representations relating to the company’s exposure to an unspecified digital token.
- The police launched an investigation into Holdnaut and its directors for possible cheating and fraud offenses under Sections 417 and 424A of the Penal Code 1871, according to the statement.
- Those who deposited digital tokens with Hodlnaut and believe they may have been defrauded through false representations by the company can file police reports supported by documentary evidence.
- Hodlnaut halted withdrawals, token swaps and deposits in August as it battled a liquidity crunch in the aftermath of the Terra-Luna stablecoin collapse. Its Hong Kong subsidiary, Hodlnaut HK suffered a US$190 million loss after the Terra algorithmic stablecoin’s dollar peg cracked, according to Bloomberg.
- In a related development, Hodlnaut’s court appointed managers said in a statement on Nov. 11 that about 25% of the company’s assets were on centralized exchanges and over 71% of those assets worth S$18.47 million were held with the now bankrupt FTX exchange. The managers tried to move the assets from FTX to other platforms but were unsuccessful in doing so, according to the statement.
- See related article:Hodlnaut owes US$200 mln debt to 17,000 creditors: report