Diksia.com - BEIJING – The former CEO of Terraform Labs and the mastermind behind the crypto scam Terra Luna has been officially sentenced to four months in prison by a court in Montenegro, United States (US).
The sentence was handed down to Do Kwon after the former Terraform boss was found guilty of using a fake passport to escape from the pursuit of international law enforcement agencies Interpol and the South Korean authorities.
“Kwon has been sentenced to prison for attempting to leave Montenegro by air using a fake Costa Rican passport, together with his business partner Hon Chang Joon,” stated the Montenegro Court, as quoted by coindesk.
Defrauding investors
Do Kwon has been on the run for several months as this crypto mogul continued to evade the South Korean government’s pursuit on charges of fraud.
The US Securities and Exchange Commission (SEC) also accused Do Kwon and Terra of intentionally providing false information regarding the South Korean mobile payment app, Chai. During its initial launch, Do Kwon claimed that this crypto payment app operated on the Terraform blockchain network.
In the lawsuit filed by the US court, the crypto platform boss, Terraform, was also found guilty of eight criminal offenses, including commodity fraud, securities fraud, wire fraud, market manipulation, and causing the disappearance of 60 billion investor funds without any accountability .
As a result of Kwon’s deception, several crypto companies, such as Three Arrows Capital, were entangled in a liquidity crisis and faced bankruptcy due to the collapse of the Terra Luna stablecoin.
These reasons prompted US authorities to intervene and investigate the case, ultimately designing Do Kwon as a suspect with charges of misleading investment activities and causing harm to investors.
“We allege that Terraform and Do Kwon failed to provide full, fair, and honest disclosure to the public as required for a number of crypto asset securities, especially LUNA and Terra USD,” said SEC Chairman Gary Gensler in a tweet on Friday, February 17, 2023.
