According to reports, Do Kwon, the infamous Co-Founder of Terraform Labs, has been accused by US prosecutors of orchestrating a cryptocurrency scam that drained $40 billion from investors. Earlier this week, the authorities in Montenegro arrested the 31-year-old developer who had been on the run for several months, hiding in numerous countries and falsifying his identity.
US Pressing Charges
As per Bloomberg, US prosecutors have named Kwon as the main culprit behind the collapse of LUNA/UST in May last year, which resulted in losses for investors. According to the US indictment, Terraform Labs operated as a cryptocurrency fraud, for which its Co-Founder should receive appropriate punishment. Kwon has been charged with securities fraud, commodities fraud, and conspiracy by a grand jury in Manhattan, one month after the US SEC’s plea that Terraform Labs and Kwon organized a massive scam by offering and selling unregistered securities through the use of digital currencies. The US Department of Justice has also launched an investigation against the project and its former employees to determine the main factors behind the catastrophe.
Kwon was detained earlier this week in Montenegro after allegedly swapping locations to stay away from the radar of multiple authorities and even Interpol. It remains unclear whether his arrest was at the request of US law enforcement agents. However, federal prosecutors stated they would seek his extradition to New York. Extradition fights could sometimes be postponed for years.
“And the first one that picks him up wins,” the attorney said.
Kwon’s Broken Promise
Kwon’s arrest came four months after he vowed to organize a conference and lift the curtain on his mysterious location. Unwilling to cooperate with the relevant authorities and regulators, the South Korean supposedly escaped his homeland and frequently changed his destination.
Apart from his alleged involvement in the Terra crash, the South Korean authorities also investigated him for taxation evasion. They maintained he gifted tokens to family members as a way of tax avoidance.
Featured Image Courtesy of Mothership