SEC Destroys Terra’s Do Kwon in Court Over Singapore Records

SEC Wins Battle Against Terra's Do Kwon Over Singapore Records

The U.S. Securities and Commission (SEC) has scored a major victory in its against Terraform Labs and its co-founder and Do Kwon. A U.S. judge has denied Kwon's request to block the SEC from accessing certain documents related to Terra's operations in Singapore. These documents could reveal more details about how Kwon ran the Luna Foundation Guard (LFG) and whether he committed and sold unregistered securities.

The SEC filed a lawsuit against Terraform Labs and Kwon in February , accusing them of orchestrating a multi-billion- crypto asset securities fraud involving an algorithmic called Terra USD () and other crypto asset securities. The SEC alleged that Terraform and Kwon misled investors about the stability of UST, which was supposed to be pegged to the U.S. dollar, but depegged and crashed in May 2022. The SEC also claimed that Terraform and Kwon offered and sold investors other crypto asset securities, such as mAssets, -based swaps that mirrored the of U.S. , and LUNA, the native of Terra's .

Kwon tried to prevent the SEC from obtaining documents from the (), the country's financial regulator, which had records of LFG, a crypto organization that was created to maintain UST's peg. Kwon argued that the SEC's request was an of power and violated his rights. However, U.S. District Judge Jed Rakoff rejected Kwon's argument and granted the SEC access to the documents at a hearing on Friday.

This is a significant setback for Kwon, who is facing multiple legal challenges in the U.S. and . In addition to the SEC lawsuit, Kwon is also facing a class-action lawsuit from investors who lost in UST and LUNA. Moreover, South Korean prosecutors have revealed that Kwon transferred $7 million to a local right before Terra's collapse, raising suspicions of . Kwon reportedly has no discernible property in South Korea and is hiding in Singapore.

What does this mean for Terra's ? Will Kwon be able to defend himself against the SEC's allegations? How will this affect the as a whole? These are some of the questions that investors and regulators are asking as they watch this case unfold.

Source: SEC Claims Victory As Do Kwon Fails To Block The Regulator From Accessing Singapore Files

Key Takeaways

  • The SEC has won a legal battle against Terra's Do Kwon over Singapore records.
  • The SEC can seek documents from MAS that could shed more light on how Kwon ran LFG and whether he committed fraud and sold unregistered securities.
  • Kwon is facing multiple legal challenges in the U.S. and South Korea over Terra's collapse.

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