The US Securities and Exchange Commission (SEC) has filed a complaint alleging securities fraud against Do Kwon, the co-founder and former CEO of the now-defunct Terra blockchain platform. According to the complaint, Kwon is charged with participating in a fraudulent scheme that caused at least $40 billion in market value to be lost. In addition, South Korea has issued an arrest order for Kwon.
Recently, South Korean prosecutors have discovered that Kwon sent 9 billion won ($7 million) to a prominent South Korean law firm, Kim & Chang, just before the collapse of Terra. According to prosecutors, Kwon’s decision to pay such a significant sum to the law firm was a planned action that pointed to his awareness of the impending collapse and anticipated legal issues.
The information, in the opinion of the prosecution, will be helpful in the continuing fraud case against Kwon. Furthermore, Kwon and Terraform‘s former CFO, Han Chang-Joon, met with attorneys from Kim & Chang during their trip to Montenegro. Kwon was detained after attempting to use false documents to board a trip to Dubai at the Podgorica airport in Montenegro. Since Kwon’s incarceration, both American and South Korean officials have asked for his extradition.
What Have The Prosecutors Discovered?
In addition to the discovery of Kwon’s payment to the law firm, South Korean prosecutors have also accused Kwon of converting illicit profits from Terra to Bitcoin. The prosecutors have requested that Binance, a cryptocurrency exchange, stop all withdrawal requests related to Kwon. Kwon and his associates have been linked to illicit assets totaling 414.5 billion won ($314.2 million), of which Kwon is thought to be personally linked to 91.4 billion won ($69 million).
Recent developments in the Kwon case show that the fraud probe is still active, and additional details might emerge in the upcoming weeks and months. Kwon is being accused of major offenses, and if proven guilty, he might be subject to heavy judicial repercussions. The incident serves as a reminder of the value of accountability and openness in the blockchain and cryptocurrency industries.