Terraform Labs CEO Do Kwon Facing Major Criminal Charges from Prosecutors in the US

 

After trying to evade law enforcement for around six months, Terraform Labs CEO Do Kwon has now been taken into police custody in Montenegro. Kwon and Terraform Labs were responsible for TerraUSD, an aspiring algorithmic stablecoin, and sister crypto Luna, which collapsed last year setting off a series of crypto failures.

Authorities in Montenegro have arrested an individual who‘s believed to be Do Kwon. Law enforcement agencies in South Korea have offered visual confirmation but are currently awaiting fingerprint details.

Kwon was reportedly apprehended at the Podgorica Airport, allegedly carrying forged documents. Terra’s Do Kwon is now with the Montenegrin police. His last known whereabouts were in Serbia, according to various reports.

The Minister of the Interior in Montenegro, Filip Adzic, revealed via social media that Montenegrin authorities had now arrested an individual who’s believed to be Terra’s Do Kwon.

Adzic further noted that Kwon was detained at Podgorica Airport with forged documents, meaning false travel documents, as Kwon’s official passport had already been revoked by South Korean authorities in September of last year. Currently, it’s not entirely clear if Kwon had been trying to enter or leave Montenegro. Podgorica is the country’s capital.

Adzic also mentioned that he has now been looking for a confirmation of Kwon’s identity.

News outlet Yonhap revealed that South Korea’s National Police Agency has been able to check the age, nationality, as well as the name with the ID card of the person taken into custody by Montenegrin authorities.

They have now confirmed his identity through photographic information. They’re currently awaiting fingerprint confirmation from Montenegrin law enforcement.

Kwon is the Chief Executive Officer at Terraform Labs.

As widely reported, Terra collapsed in spectacular fashion back in May of last year. This was when the initiative’s algorithmic stablecoin, UST, had lost its peg to the dollar and had gone into a death spiral, resulting in over $40 billion being taken out from the crypto markets.

While not cooperating with various police investigations, Kwon left South Korea in order to travel to Singapore soon after Terra’s demise. At the time, Interpol had given a notice for the said person in September 2022, which had made Kwon a wanted man in around 195 countries.

However, Kwon maintained that he had not been running from authorities and had also been active on social media channels.

Authorities in Korea stated back in December that Kwon may have been hiding in Serbia.

Kwon had been traveling with an aide (named Han) at the time when he was apprehended.

DL News reported that Serbian authorities had been trying to follow Kwon’s activities and initiated a pre-extradition process. It’s possible that he might have been trying to get away from Serbian law enforcement by entering Montenegro.

Federal prosecutors in the US have now filed criminal charges against the Terraform Labs founder, who currently also faces civil charges in the US.

With the news of Do Kwon being arrested yesterday, US Federal prosecutors in New York have officially charged the Terraform Labs founder with fraud. This has come just a few hours after he was apprehended by authorities in Montenegro.

Kwon, whose location could not be confirmed for several months, is currently facing an investigation in Korea. He has been on an Interpol wanted list due to the past year’s TerraUSD collapse.

Kwon faced civil charges that were filed by the US Securities and Exchange Commission (SEC), which claimed last month that he had intentionally misled unsuspecting investors.

As per the complaint, Kwon is charged with engaging in conspiracy to defraud, commodities fraud, wire fraud, securities fraud, as well as conspiracy to take part in market manipulation.

According to reports, the Department of Justice may now be seeking his extradition to the United States.

The filing now claims that Do Kwon issued several “untrue” as well as “misleading” statements of “material fact” during a period spanning several years. This is based on various TV appearances and social media posts by Terraform Labs.

The filing states:

“Kwon agreed with others to defraud purchasers of cryptocurrencies issued by TFL, by deceiving those purchasers about the effectiveness of the algorithmic mechanism that purportedly ensured the stability of UST’s price through false statements and market manipulation.” 

The filing also mentioned that Kwon had “contacted representatives of a United States trading and investment firm” for assistance in “altering” the market price of the algorithmic stablecoin UST.


Register Now to Attend
Sponsored Links by DQ Promote

 

 

Send this to a friend