In Ho3Ru4Al12, the Ho atoms form a distorted kagome lattice. We performed magnetization, magnetic-susceptibility, specific-heat, and ultrasound measurements on a single crystal. We find that the magnetic and magnetoelastic properties of Ho3Ru4Al12 result from an interplay between geometric frustration and crystal-electric-field (CEF) effects. The Ho atoms order antiferromagnetically at TN=4.5K with reduced magnetic moments. In applied field, the magnetization shows anomalies that can be explained by CEF level crossings. We propose a CEF level scheme for which the ground-state doublet and the first two excited singlets at about 2.7 K form a quasiquartet. Indirect interlevel transitions allow for a quadrupolar interaction. This interaction explains well changes in the elastic shear modulus C44 as a function of temperature and magnetic field.