Singapore police have launched an investigation into Terraform Labs and its founder Do Kwon, who remains a fugitive in his home country South Korea, Bloomberg News reported, citing an emailed statement from law enforcement.
Kwon owns 92% of Terraform Labs and is the sole director and CEO of the firm.
The police did not clarify the nature of the investigation beyond the fact that it is “ongoing” and added that Kwon is not currently in the country.
Terraform Labs is headquartered and registered in Singapore but has not been scrutinized by the country’s law agencies until now despite facing criminal charges in other countries.
Criminal charges
Both Kwon and Terraform Labs have been under investigation for several months in South Korea and are facing fraud-related criminal charges for the $60 billion Terra LUNA collapse in May 2022.
Kwon’s whereabouts remain unknown after he absconded, facing legal action in South Korea. The country’s law enforcement has issued multiple international arrest warrants for him and is still looking to prosecute.
Korean police claimed in December 2022 that Kwon was hiding out in Serbia. Kwon was active on social media via occasional tweets until Feb. 1 but has gone radio silent since then.
Meanwhile, the U.S. SEC also levied charges against Kwon and Terraform Labs in January and is looking to prosecute him for fraud.
SEC’ lawsuit
The SEC has filed a lawsuit against Kwon and Terraform Labs over the collapse of the cryptocurrencies they created, comprising multiple counts of securities fraud.
The SEC claims that Kwon repeatedly “misled, deceived and defrauded” investors. It added that the Terra LUNA ecosystem was a fraudulent scheme and Kwon illegally offered securities without registering with the SEC, which ultimately led to the loss of more than $40 billion.
The lawsuit also labels both LUNA and UST as securities.
Additionally, the filing claims that Kwon and Terraform Labs moved 10,000 Bitcoin out of the project and into a cold wallet in May 2022 and have been periodically selling BTC since June 2022.
The proceeds were transferred to an unnamed Swiss Bank and then withdrawn.
“Between June 2022 and the date of this complaint, over $100 million in fiat currency has been withdrawn from that Swiss bank.”
Source: https://cryptoslate.com/do-kwons-terraform-labs-under-investigation-in-singapore/