Terra/LUNA co-founder Do Kwon and chief financial officer Han Chang-Joon find themselves in the spotlight as prosecutors in Montenegro appeal against their release conditions. Kwon and Han were granted a release from detention on bail of €400,000 ($436,000) each, also receiving house arrest orders with a requirement to respond to court summons regularly. Montenegro’s State Prosecutor’s Office in the capital Podgorica has since filed an official appeal on the decision made on May 12 to release them.
Kwon and Han were accused of forgery using false passports from Belgium and Costa Rica by Montenegro prosecutors last month, with a potential punishment of up to five years in prison awaiting them. They have both pleaded not guilty so far. Montenegro is not the only country looking to bring charges against the Terraform Labs executives; courts in South Korea, Singapore, and the US also have their sights set on them.
The United States Securities and Exchange Commission (SEC) accused Kwon and others of knowingly trading unregistered securities, with South Korean prosecutors also hoping to bring Kwon to trial on similar charges. Terra’s legal team, however, fired back at the SEC by claiming its charges were baseless and that Terra stablecoins were “currencies,” putting them outside the SEC’s jurisdiction. Consequently, the lawyers filed a motion for the charges to be dismissed.
In the meantime, Kwon reportedly “cashed out $2.8 million worth of crypto before being released on bail in Montenegro.” Nearly $500,000 worth of Tether (USDT) was withdrawn from a wallet believed to be Kwon’s about a week prior. Additionally, approximately 2.39 million Terra Luna Classic (LUNC) coins were withdrawn from a Kwon-linked wallet. Podgorica court documents also showed that both Kwon and Han claimed to have property in South Korea.
That said, South Korean prosecutors deem all of Kwon’s funds as proceeds of crime. But they admit to having failed to freeze all of the CEO’s crypto funds. Seoul remains optimistic about persuading Montenegrin officials to deport Kwon to his native country to face fraud charges.
In late April, the Seoul Southern District Prosecutors’ Office indicted ten people, including Terra co-founder Daniel Shin, on several charges associated with the failed Terra/LUNA project. Shin’s lawyers argued that their client had left Terraform Labs in 2020 and was not involved in the massive 2022 Terra crash. The ongoing legal battles surrounding Terra and its executives highlight the importance of regulations and transparent compliance in the world of cryptocurrency.
Source: Cryptonews
