Prosecutors investigating failed blockchain company Terraform Labs have found that the company’s Singapore office transferred millions of US dollars to lawyers just before the cryptocurrency crash The money was transferred from the company’s Singapore office to its lawyers. According to Korean media, the transfers suggest that co-founder Do Kwon was aware of the impending collapse.
Terraform Labs wired a large sum of money to a Korean law firm before the accident
South Korean prosecutors working on a fraud case against Terraform Labs co-founder and CEO Do Kwon have revealed that the company paid Kim&a total of 9 billion won ($7 million). State broadcaster KBSreported that Chang, one of the country’s leading law firms,.
After tracking the flow of funds from the company’s Singapore headquarters, we were able to confirm that funds were sent in multiple transactions from just before the collapse of Terraform’s digital currencies, stablecoin terrausd and cryptocurrency luna, in May of last year
Investigators in Seoul are working with law enforcement authorities in Singapore to confirm the origin of the payments. If the blockchain company is found to have cashed in the digital coins, embezzlement charges could be brought against its management.
The report notes that Terraform’s chief executive officer was likely aware in advance of the potential collapse of the crypto ecosystem and was prepared to take certain legal steps in response to anticipated judicial risks, such as this investigation.
KBS allegedly transferred the full amount estimated by KBS to Kim&Chang over a period of several months. South Korean prosecutors believe that if these funds originated from criminal proceeds, they could be frozen and eventually seized.
It is estimated that about 200,000 people purchased Terraform cryptocurrency and suffered significant losses as its collapse erased billions of dollars in market value.
Do Kwon (Kwon Do-Hyung) was arrested by authorities in Montenegro in March as he and Han Chang-joon, the company’s chief financial officer, were leaving for Dubai. He is scheduled to stand trial for traveling with false documents in the Balkan country before Podgorica considers extradition to South Korea or the United States, where he is charged with masterminding a crypto fraud.
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