South Korea to revive interagency task force to probe Terra collapse, reports say

South Korean authorities have recreated an interagency task force, disbanded more than two years ago, to investigate the collapse of Terra. The team was previously nicknamed the “Grim Reapers,” local media reported.

Grim Reaper v. Phoenix — Special Investigation Team Probe into Do Kwon and Terrahttps://t.co/i9V6TQhY19

— Jun (@zunahn) May 19, 2022

Since 2013, the Yeouido Grim Reaper group, composed of prosecutors and regulators in the financial and securities sectors, has conducted 346 arrests in 965 cases, largely related to market manipulation.

According to SBS News, about 280,000 investors in the country were affected by Terra’s collapse. On the eve of the crash, the market capitalization of the project’s native token LUNA stood at about $24.5 billion, compared with $0.8 million at the time of writing (CoinGecko).

Losses sustained by the Korea-based blockchain firm Hashed from investments in Terra ecosystem assets amounted to $3.5 billion.

The interagency group suspects the project’s founders of orchestrating a Ponzi scheme.

In addition to investigating Terra’s collapse, the Yeouido Grim Reaper team will reopen the case against the Lime-Optimus Fund, which was not completed before its disbandment in 2020. It concerns the embezzlement of $1.2 billion of investors’ funds.

Co-founder of Terraform Labs, Do Kwon, also faces a fine of 100 billion won ($78 million) for evading corporate and income taxes, according to Edaily.

On May 17, Kwon proposed a rescue plan for the Terra ecosystem by conducting a hard fork with the launch of new networks and a token. Although the community reacted negatively to the idea, validators voted in favour of its implementation.

In Korea, the collapse of the project was proposed to be discussed at the parliamentary level.