Korean police request to freeze assets of Luna Foundation Guard

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2022-05-25 15:22:27

Sources from the national broadcaster KBS, the Korean police have opened an investigation into embezzlement involving an employee of Terraform Labs.

Accordingly, in order to prevent money transfers, the police asked cryptocurrency exchanges to freeze all accounts of Luna Foundation Guard (LFG).

Seoul police order to freeze the accounts of LFG

Yesterday (May 23), the Cybercrime Investigation Unit of the Seoul Metropolitan Police Agency announced that it was conducting an investigation on suspicion of embezzlement by a Terraform Labs employee.

Excerpt from the sheet Chosun Dailyan official from the Seoul Metropolitan Police Agency said:

“We have received information that a person suspected of embezzlement of company funds is believed to be an employee of Terraform Labs.”

In mid-May, an allegation of embezzlement was filed with the Seoul police station. Accordingly, the city police officially reviewed the incident and investigated. Specifically, the plan is to examine the details of cash and cryptocurrency transactions of Terraform Labs and Luna Foundation Guard (LFG).

Police said evidence of embezzlement showed money had flowed into the Luna Foundation Guard. They asked domestic electronic exchanges, such as Upbit and Bithumbmust “urgently” freeze accounts belonging to LFG, in order to prevent funds from being withdrawn from cryptocurrency exchanges.

However, the request to freeze the account is not a mandatory requirement under Korean law in this case. The choice belongs to the cryptocurrency exchanges. Therefore, it is not clear at this time whether the freeze requests have been approved or not.

The most “traumatic” incident in the history of Terra’s cryptocurrency has shaken the entire market. The Korean government was also forced to step in to urgently investigate these two cryptocurrencies. The government is reported to have met with representatives of the country’s leading cryptocurrency exchanges to discuss measures to prevent similar incidents from occurring.

In the last week, CEO Terra has faced a series of lawsuits related to damages caused by individuals investing in this ecosystem. The victims filed a lawsuit against Kwon Do-hyung (Do Kwon) with the Seoul Southern District Prosecutors’ Office on charges of violating the Act, with specific economic crimes (fraud) and the Act on Regulation of the similar revenue.

Besides, many rumors suggested that Do Kwon dissolved Terraform Labs Korea a few days before LUNA and UST collapsed. Responding to suspicions of foul play, Kwon affirmed that the time was just “accidental”. Kwon also said his company does not owe the South Korean government any taxes.

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