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South Korean Prosecutors Applaud ‘Meaningful’ US Do Kwon Charges

Tim Alper
Last updated: | 1 min read
Do Kwon, the CEO of Terraform Labs.

South Korean prosecutors have applauded “meaningful” charges brought against Do Kwon, the Co-founder of Terraform Labs, by the top American financial regulator.

The comments came after the United States Securities and Exchange Commission (SEC) issued Kwon and Terraform Labs with a securities fraud wrap late last week. The SEC stated that Kwon had “orchestrated a “multi-billion dollar crypto asset securities fraud involving an algorithmic stablecoin and other crypto asset securities.”

Kwon’s whereabouts are currently unknown – although South Korean prosecutors say they believe he is residing in Serbia. Kwon’s South Korean passport has been canceled and an Interpol red notice has been issued for his arrest.

Per the Gangwon Provincial Daily, a South Korean prosecution spokesperson stated:

“It is meaningful that the [SEC] has made a clear indictment of CEO Kwon. We will do our best to repatriate CEO Kwon as quickly as possible.”

Prosecutors have also claimed that Kwon transferred bitcoin (BTC) to a Swiss bank account in June last year. The SEC claimed that Kwon sent BTC 10,000 to a cold wallet.

The SEC said Kwon has since cashed out some $100 million via the Swiss financial institution. The SEC said transactions on the account had been made “between June 2022 and February 2023.”

Kwon had previously claimed that his whereabouts were not a secret. He claimed on social media last year that he would soon reveal his location, and invite his detractors to meet.

But since December 10, around the time South Korean prosecution officials began alleging they had traced him to Serbia, he has refrained from posting to Twitter.

Do Kwon: Wanted in South Korea and the US

Previously, Kwon had claimed that the charges brought against him in South Korea were “politically motivated.”

A graph showing 24-hour Terra Luna Classic (LUNC) prices on February 20, 2023.
24-hour Terra Luna Classic (LUNC) prices on February 20, 2023. (Source: CoinMarketCap)

South Korean prosecution officials want to try Kwon on securities violations. However, legal experts have warned this could prove difficult as cryptoassets are not classified as securities under existing South Korean legislation.

A number of civil cases are also pending in South Korea.

But in the United States, the investment firm Albright Capital last month pulled out of a class action lawsuit against Terraform. Albright and co-claimants voluntarily retracted their claims “without prejudice and without costs.”