Do Kwon, the cryptocurrency entrepreneur behind two digital currencies that misplaced an estimated $40 billion (practically Rs. 3,28,500 crore) or extra final 12 months, has been charged with fraud by USÂ prosecutors.
An eight-count indictment towards Kwon was made public in the USÂ District Court in Manhattan, a number of hours after information of his arrest earlier Thursday in Montenegro.
Lawyers for Kwon in the United States didn’t instantly reply to requests for remark after enterprise hours.
Thursday’s indictment fees Kwon, a South Korean nationwide who co-founded Terraform Labs and developed the TerraUSD and Luna currencies, with two counts every of securities fraud, wire fraud, commodities fraud and conspiracy.
The felony case follows associated USÂ Securities and Exchange Commission civil fees towards Kwon and Terraform final month.
Kwon had been a fugitive for a number of months, and South Korean authorities issued an arrest warrant for him final September.
South Korean police stated on Friday that the identification of the suspect arrested in Montenegro had been confirmed as Kwon after his fingerprints matched the knowledge held by the nation’s National Police Agency (KNPA).
“This has been shared with the Seoul Southern District Prosecutors’ Office and Interpol in Montenegro,” one official on the KNPA stated.
Prosecutors will work with different establishments to hold out a swift repatriation, a spokesperson for the nation’s prosecution service stated.
Montenegro’s inside ministry stated police detained an individual regarded as Kwon and a second suspect, who had been attempting to board a flight to Dubai at Podgorica airport.
Police discovered solid passports of Costa Rica and Belgium in the course of the encounter, the ministry stated.
“The person is suspected of being one of the most wanted fugitives, South Korean national Do Kwon, a co-founder and CEO of the Singapore-based Terraform Labs,” Interior Minister Filip Adzic wrote on Twitter.
“The former cryptocurrency king who is behind losses of over $40 billion, has been apprehended at the Podgorica airport with forged documents,” Adzic added.
TerraUSD was a so-called “stablecoin” designed to keep up a relentless $1 worth, whereas Luna’s worth fluctuated.
But authorities have stated TerraUSD and Luna had been paired, such {that a} decline in one may take down the opposite.
They additionally stated Kwon misrepresented the steadiness of TerraUSD, as soon as among the many prime 10 cryptocurrencies by market worth.
Both currencies crashed final May, with TerraUSD’s worth sinking to lower than one penny.
In its civil case, the SEC accused Kwon and Terraform of “orchestrating a multi-billion dollar crypto asset securities fraud.
“We additionally allege that they dedicated fraud by repeating false and deceptive statements to construct belief earlier than inflicting devastating losses for buyers,” SEC Chair Gary Gensler said in a statement at the time.
© Thomson Reuters 2023
