Do Kwon’s Fraud Charges & Arrest: The Collapse Of Terra (Luna) Tokens

Do Kwon, the co-founder, and CEO of the crypto firm Terraform Labs, based in Singapore, which created the infamous Terra (Luna) tokens that collapsed last year, was charged with fraud by U.S. authorities in New York on Thursday.

Kwon is hiding, and its location has been unknown for months. And he is also under investigation in South Korea and has been on the Interpol wanted list. According to the nation’s interior minister Filip Adzic, tweet Do Kwon appears to have been detained in Montenegro.

U PODGORICI UHAPŠEN JEDAN OD NAJTRAŽENIJIH SVJETSKIH BJEGUNACA

Crnogrska policija lišila je slobode lice za koje se sumnja da je jedan od najtraženijih bjegunaca, južnokorejski državljanin Do Kwon, suosnivač i izvršni direktor Terraform Labs sa sjedištem u Singapuru.
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— Filip Adzic (@filip_adzic) March 23, 2023

Filip Adzic, Montenegro’s interior minister Via Twitter announce the arrest of Kwon. Following Adzic’s account is the official account of Montenegro’s Prime Minister, Dritan Abazovic, who retweeted the statement. But, Adzic’s account is not verified, and formal confirmation of Kwon’s identity is still pending.

As the Yonhap news agency reported, the Korean National Police Agency claimed that after verifying the suspect’s age, name, and nationality on his I.D. card, it had determined that the person appeared to be Kwon.

In February, the U.S. Securities and Exchange Commission (SEC) claimed that Kwon had deceived investors and had filed civil charges against him.

Allegation On Terra (Luna) Founder

According to the complaint, Kwon is guilty of eight counts. In addition, including conspiracy to commit fraud and market manipulation, wire and commodities fraud, and securities fraud.

Several “untrue and misleading statements of material fact” were alleged to have been made by Kwon for several years, according to the filing, which cited television appearances and tweets from accounts connected to Terraform Labs.

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

Kwon “contacted officials of a United States trading and investment firm,” as stated in the document, asking for assistance in “changing the market price of UST,” and the company responded.

However, Kwon has been the focus of multiple investigations. It was even on Interpol’s red notice after stablecoin terraUSD (UST) and its $40 billion ecosystem collapsed last year.

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Singapore, the United States, and South Korea want Kwon’s extradition. Also, the Department of Justice said it would ask for his extradition to the United States.