Disgraced Terra Founder Do Kwon Reaches Preliminary Settlement With the SEC After Being Found Liable for Fraud
Do Kwon appears to have reached a preliminary settlement with the U.S. Securities and Exchange Commission (SEC).
In April, a jury found Kwon and Terraform Labs liable for defrauding investors regarding the stability of the algorithmic stablecoin Terra USD, which de-pegged and collapsed in 2022, causing crypto prices to plummet across the board.
The case’s court docket indicates oral arguments regarding Kwon and the company’s penalties were originally scheduled for May 29th but canceled because “the parties have informed the Court that they reached a settlement in principle.” Both sides have been instructed to file papers in support of a final judgment by June 12th.
In April, the SEC filed a motion requesting that Kwon and Terraform Labs pay more than $4.19 billion in disgorgement plus $545.7 million in prejudgement interest. The regulator also sought a $100 million civil penalty from Kwon and a $420 million penalty from the company.
Kwon was initially arrested by authorities in Montenegro in 2023 after he was caught attempting to board a flight to the United Arab Emirates (UAE) with a forged Costa Rican passport.
He is currently awaiting extradition to both the US and South Korea, where he’s wanted by authorities for his role in the $40 billion collapse of the Terra ecosystem.
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