Singapore police investigates crypto lender Hodlnaut for alleged fraud

The embattled crypto lender that halted withdrawals in August is now facing a police probe for possible fraud and cheating offenses.

Spreadsheet bank accounts accounting with calculator and magnifying glass - stock photo

On Wednesday, the Singapore Police's commercial affairs department (CAD) launched a probe into Hodlnaut Pte and its directors. Earlier in August, the company confirmed that there are “pending proceedings” with the police.

The investigation comes three months after the platform froze clients’ withdrawals and filed for interim judicial management that would grant it temporary creditor protection. The suspension of withdrawals was triggered by Terra’s collapse in May, which cost Hodlnaut nearly $190 million. At the time, the crypto lender claimed that it has no exposure to the now-defunct UST stablecoin and deleted all financial documents that might suggest otherwise.

“Between August and November 2022, the Police received multiple reports alleging that Hodlnaut and/or its directors had made false representations relating to the company’s exposure to a certain digital token,” the police statement reads.

The police advised investors affected by the Hodlnaut crisis to file a police report with attached records of payments on the platform as well as other relevant correspondence.