U.S. prosecutors charge Do Kwon with fraud

The U.S. Attorney’s Office for the Southern District of New York предъявила charges against the co-founder and CEO of Terraform Labs (TFL) Do Kwon, hours after his arrest in Montenegro.

The indictment contains eight counts, including conspiracy to commit securities fraud and market manipulation, securities fraud, and investor deception.

“Kwon conspired with others to deceive buyers of cryptocurrencies issued by TFL, by misleading them about the effectiveness of the algorithmic mechanism that allegedly provided price stability for the UST, through false statements and market manipulation,” the regulator said.

The indictment was filed in the Southern District of New York. A spokesperson for the prosecutors, in a comment to CoinDesk, clarified that the DOJ intends to seek Kwon’s extradition to the United States.

After Terra’s collapse, the Seoul Southern District Prosecutors’ Office became interested in TFL’s activities, and a court issued an arrest warrant for Do Kwon and five others.

In February 2023, the U.S. Securities and Exchange Commission filed Terraform Labs and its CEO with charges in a multibillion-dollar securities fraud scheme.

Earlier, on March 23, police detained Kwon on forged documents at the airport Подгорицы at the request of U.S. law enforcement, Singapore and South Korea.