Due to Kwon being sued, Korea re-established a financial task force to investigate the Terra case

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2022-05-25 03:20:28

Many investors who suffered heavily in the collapse of the Terra ecosystem are preparing to file a lawsuit against CEO Do Kwon. With the seriousness of the case, the Korean financial authorities decided to set up a special investigation team to target Terraform Labs.

Do Kwon prepares to face lawsuits

Law firm LKB & Partners will sue Do Kwon

South Korea’s Munhwa Ilbo newspaper reported on May 18 that law firm LKB & Partners is preparing the final proceedings to sue Terra’s CEO, Do Kwon. LKB will represent many individual investors who suffered losses in the fall of LUNA – UST, including many employees of law firms. The complaint is expected to be sent to the Financial Investigation Team of the Seoul Metropolitan Police Department. Not stopping there, LKB also sent an application to the Seoul Southern District Prosecutor’s Office, requesting the confiscation of Mr. Do Kwon’s assets.

Investors suffering heavy losses will sue Do Kwon in Korea

Another source on Twitter confirmed that in addition to the above two civil and criminal lawsuits, a community of investors from Korea claiming to be “Victims of LUNA, UST” with more than 1000 members will also launch. Sue Do Kwon and Daniel Shin next week, alleging “fraud and illegal fundraising”. However, this information has not been verified.

Korea’s “Death” financial investigation task force is re-established

On the evening of May 18, Korean broadcaster SBS reported that the Financial Services Commission and the Financial Supervisory Authority of Korea had re-established the “Death” task force to investigate how Terraform Labs attracted investors. Given the seriousness of the incident and the exceptionally large amount of assets lost, amounting to billions of dollars, the event attracted a lot of attention from the media and investors.

“Death” is the nickname given by the Korean media to the financial task force of the two agencies because of its accuracy and thorough investigation, having dismantled many economic cases in the country in the past. . “Death” was dissolved in 2020, but has been re-established to take over the Terra investigation.

Meanwhile, Korea’s Edaily newspaper confirmed that Terraform Labs is being investigated for alleged tax evasion of 100 billion won ($78 million) related to the establishment of the Luna Foundation Guard fund in February 2022. This fund had the purpose of hoarding cryptocurrencies as collateral for the UST, but failed to use up all of the $3 billion in Bitcoins in just 3 days but still failed to save the UST price.

Terraform Labs is alleged to have registered the establishment of Luna Foundation Guard in Singapore, but fund management activities are still conducted in Korea, thus subject to tax liability. In addition, Korean tax authorities also prepared another 100 billion won fine for Luna Foundation Guard, but the reason is unknown.

CEO Do Kwon in particular and Terraform Labs in general are facing many legal cases when being asked to testify before the National Assembly and sued by retail investors after the collapse of the model. LUNA – UST. This is also understandable when the handling of the executive team is not really satisfactory and causes a lot of controversy in the community. Even the CEO of Binance complained about Terra’s handling of the case and had opposing opinions with Do Kwon.

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