• Fri. Aug 18th, 2023

Real Estate of Terra Employees And Investors Seized by South Korean Authorities

Apr 27, 2023
Marcel Bich

Real estate, vehicles, and stocks worth $205 million have been seized.

The assets of eight people associated with the Terraform Labs ecosystem were seized by financial crime investigators at the Seoul South District Prosecutor’s Office. Early-stage investors as well as employees of the startup came under law enforcement sanctions, the Korean media reported.

In total, the investigation team seized assets worth 210 billion won (about $205 million). Among other things, Daniel Shin, co-founder of the Terra ecosystem, had his real estate seized, while vehicles and stock market assets were taken from a number of people associated with the startup.

According to prosecutors, these properties were confiscated because they were purchased with criminally derived funds. While the trial is ongoing, the suspects will not be free to dispose of their assets. After the inventory, law enforcement intends to return the funds and compensate Terra’s victims.

Terra investigation is ongoing

Terraform Labs co-founders Daniel Shin and Do Kwon are suspected of fraud. After Terra’s ecosystem collapsed in 2022, the project’s investors sued the founders. The collapse was due to the weakening of the UST’s peg to the U.S. dollar. According to a lawsuit, Terra’s founders intentionally misled investors to fulfill their pump-and-dump scheme.

The lawsuit was filed on behalf of 359 investors for $57 million against one of the co-founders, Do Kwon. In late March of this year, Kwon was caught by Montenegrin police with forged documents. After Kwon was caught, the New York prosecutor’s office charged him with eight counts of fraud. Among other things, Kwon is charged with securities and asset fraud, as well as participation in a conspiracy.

Daniel Shin, the second co-founder, has so far managed to avoid arrest. The Seoul prosecutor’s office sought his detention for allegedly making about $105 million in illicit profits by selling Luna (LUNA) tokens before the ecosystem collapsed. However, the court found the prosecution’s arguments unconvincing.