Do Kwon Faces 5 Crimes Of Fraud After Getting Arrested
- After a few hours of arrest, Terraform Labs founder Do Kwon has faced criminal charges from US prosecutors.
- His charges involve spreading false information about the UST stablecoin, market price manipulation, and securities fraud.
- A spokesman for the United States Attorney’s Office in Manhattan said the Justice Department would seek to deport Do Kwon to the United States.
- Tokens LUNA and LUNC both recorded sharp declines after Do Kwon’s arrest.
Hours after Terraform Labs founder Do Kwon was arrested by police in Montenegro, New York, federal prosecutors charged him with five criminal charges related to fraud.
“Kwon agreed with others to defraud purchasers of cryptocurrencies issued by TFL, by deceiving those purchasers about the effectiveness of the algorithmic mechanism that purportedly ensures the stability of UST’s price through false statements and market manipulation,”The filing meaningful under one of the charges.
The petition also alleges that Do Kwon contacted a US trading and investment company representative for help in “changing the market price of UST” that the company had provided.
This is also an allegation that the SEC made a similar allegation in its complaint last month, and the company in question appears to be Jump Crypto.
Kwon was charged with conspiracy to commit fraud, commodity fraud, securities fraud, wire fraud, and conspiracy to manipulate the market, according to the indictment. In February, the US Securities and Exchange Commission (SEC) filed civil charges against Terraform and Do Kwon for defrauding investors and selling unregistered securities and stock swaps.
Separately, a spokesperson for the United States Attorney’s Office in Manhattan said the Justice Department would seek to deport Do Kwon to the United States, the Wall Street Journal reported.
According to previous news, the Minister of Interior of Montenegro Filip Adzic announced that Do Kwon was arrested by the police at Podgorica Airport in Montenegro earlier Thursday using forged documents. The Korean National Police Agency later confirmed his identity.
After the collapse of LUNA-UST in May 2022, Do Kwon kept his location secret for months, also faced an investigation in South Korea, and he was on the wanted list of both Korea and Interpol.
After the arrest, the price of LUNC (old LUNA token) and LUNA (New token deployed by Do Kwon after the crypto crash) saw a sharp drop.
Terra (LUNA) price dropped to $1.27, down 8% at the time. Currently, the token has recovered to the level of $1,350.
Meanwhile, Terra Classic (LUNC) is down 4%, with the price currently trading at $0.000123. However, it has since recovered to the original price. Now it is trading at $0.001261.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu