Terraform Labs Founder Do Kwon Found Guilty of Document Forgery and Sentenced to 4 Months in Jail
A court in Montenegro found Do Kwon guilty of forging documents and sentenced him to prison. Kwon will remain in detention for a longer period pending the state’s response to his extradition request.
Terraform Labs CEO and co-founder Do Kwon was found guilty of document fraud and sentenced to four months in prison. Kwon was convicted and sentenced by a basic court in Podgorica, the capital of Montenegro.
Montenegrin authorities arrested Do Kwon again in March for carrying false documents. Law enforcement arrested Kwon and Han Chang-joon, another Terraform Labs executive. Both have been held since their arrest.
Although the Podgorica Supreme Court has granted bail to the executives, a local news outlet RFE mentioned Kwon will remain in custody for six months. It will be a period during which domestic courts will deliberate on whether or not to allow an extradition request from South Korea to go into effect. Podgorica Supreme Court Certain News report to CoinDesk.
Like South Korea, the United States has also requested extradition. Both countries want Kwon to answer the collapse of Terraform Labs, including LUNA and UST cryptocurrencies.
He refused Do Kwon’s bail terms before a guilty verdict
Last month, a substantive court in Podgorica approved a bail motion launched by Kwon’s lawyers for the release of the CEO and Chang Joon. The lawyers suggested a supervised bail, each person paying €400,000 (or $435,000) as the trial progressed. After approval, the plaintiff quickly appealed the decision to the Podgorica Supreme Court, which ultimately ruled against approval.
Notably, the court ruling specified that the four-month prison sentence would include time the executives had already spent in custody. The ruling also instructed the authorities to confiscate two Belgian and Costa Rican passports and two identity cards belonging to the executives.
In September last year, South Korea began searching for Do Kwon and asked Interpol to issue a “red notice” for Kwon. A Red Notice is a call for Interpol to immediately detain anyone pending surrender, extradition, or other action. However, Do Kwon announced on Twitter at a string He was not guilty of anything and was not a fugitive. He also said there was no need for anyone to know his exact GPS coordinates, adding that he would defend himself against any charges.
“I am not a ‘fugitive’ or anything similar – for any government agency that has shown interest in reaching out, we are in full cooperation and have nothing to hide. We are in the process of advocating for ourselves in multiple jurisdictions – we have held ourselves to a very high standard of integrity, and look To clarify the truth over the next few months.”
Last May, South Korea’s national tax agency found Do Kwon and Terraform Labs guilty of tax evasion and fined them $78 million. According to the agency, Terraform and Do Kwon violated South Korea’s corporate tax law, which requires foreign companies to pay taxes if they are run locally, regardless of country of registration. The agency also claims that prior to the Terraform crash, Kwon attempted to liquidate the company and exit South Korea.
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Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify cryptocurrency stories down to the bare essentials so that anyone anywhere can understand without much background knowledge. When not in the depths of cryptocurrency stories, Tolo enjoys music, loves to sing, and is a movie lover.
