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Prosecution seeking to freeze assets of crypto fugitive Kwon

National 16:51 April 11, 2023

By Kim Han-joo

SEOUL, April 11 (Yonhap) -- Prosecutors said Tuesday they are in the process of freezing assets of Do Kwon, the co-founder of cryptocurrency firm Terraform Labs, who was recently arrested.

The 32-year-old Kwon is being held in Montenegro after being on the run for nearly 11 months for the alleged cryptocurrency fraud that wiped out nearly US$40 billion in market value.

The Seoul Southern District Prosecutors' Office said it is waiting for a court order to freeze some 7.1 billion won ($5.3 million) of Kwon's assets in the country. The decision allows prosecutors to lock down suspected criminal proceeds for potential criminal forfeiture until a court makes a verdict.

Prosecutors said they are also tracking down overseas criminal proceeds flown into various cryptocurrency exchanges and Swiss bank accounts.

Kwon has been under investigation for alleged fraud and tax evasion by South Korean prosecutors after investors in TerraUSD and Luna filed complaints against Kwon last May, accusing him of a Ponzi scheme over the loss of billions of won following the crash of both coins.

Prosecutors have since sought an arrest warrant for Kwon on allegations that included providing false information to investors and the violation of the capital market law.

Interpol also issued a red notice, used for the highest level of wanted suspects and criminals. His passport has since been invalidated.

Prosecutors already froze assets of Daniel Shin, another co-founder of Terraform Labs, who is accused of gaining illegal profits before the collapse of the coins.

A court earlier ordered the asset freeze of around 154.1 billion won worth of Shin's assets, including land, buildings and cars.

TerraUSD was designed as a stablecoin, which was pegged to stable assets, like the U.S. dollar. But holders of TerraUSD and Luna lost more than an estimated $40 billion in market value after the stablecoin plunged far below its $1 peg last May.

Prosecution seeking to freeze assets of crypto fugitive Kwon - 2


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