South Korean Prosecutors Discover New Evidence of Deception by Terra Founder and Former CEO
South Korean prosecutors have uncovered new evidence suggesting that Terra founder Do Kwon and former Chai CEO Shin Hyun-Sung collaborated to deceive investors through fraudulent transactions. The evidence reveals a disturbing chat between Kwon and Shin discussing the manipulation of transactions through the Chai payment app used by Terraform Labs.
Allegations of Fraud and Deception in Terra and Luna Tokens Collapse
Terraform Labs co-founder Kwon Do-Hyeong, a key figure in the collapse of Terra and Luna tokens, is accused of conspiring with ex-CEO Shin Hyun-Sung to mislead investors with fake transactions. The chat between Kwon and Shin, discussing the creation of fake transactions that appear real, sheds light on their intent to deceive investors from the start of the project.
Consequences of the Terra Collapse and SEC Lawsuit
Following the downfall of Terra and Luna, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Kwon and Terraform Labs for misleading investors about Terra’s stability. Kwon was found guilty of fraud in New York and reached a settlement with Terraform Labs to pay $4.47 billion in disgorgement and fines. Kwon’s arrest in Montenegro for passport fraud and facing multiple charges by New York prosecutors further highlight the legal repercussions of the Terra collapse.
