- TerraUSD co-founder Do Kwon has been reportedly arrested in Montenegro
- He was apprehended with falsified documents at the Podgorica airport
- Do Kwon had been wanted for alleged fraud in Terraform Labs’ crash in 2022
Do Hyeong Kwon, the co-founder of Terraform Labs (the ecosystem of TerraUSD), has been reportedly arrested in Montenegro with falsified documents. His former business partner, Han Mo, was also said to be captured with him at the airport of the country’s capital, Podgorica. This report resulted from a tweet from the country’s minister of interior, Filip Adzic. He said,
“Montenegrin police have detained a person suspected of being one of the most wanted fugitives, South Korean citizen Do Kwon, co-founder and CEO of Singapore-based Terraform Labs.”
How was Do Kwon arrested?
According to the Montenegro Interior Ministry, Do Kwon and Han Mo was apprehended at the Podgorica airport as they tried to board a flight to Dubai using fake Costa Rican passports.
Although no official records of them entering Montenegro, the police remanded the two men on forgery charges.
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Similarly, a local South Korean news outlet, Yonhap Agency, publicized that authorities confirmed this report due to photo data and details on an ID card. The details of Do Kwon on the ID card were identical to the apprehended individual, which corroborated suspicions.
Nonetheless, the National Police Agency of South Korea has yet to confirm this. Instead, they claimed to have been waiting for fingerprint identification from the Montenegrin police to ascertain that the apprehended individuals were Do Kwon and Han Mo. South Korean prosecutors revoked Do Kwon’s passport in October 2022 after the Terra USD controversy.
Consequently, according to a spokesman for the U.S. attorney, the U.S. Justice Department would seek to have Do Kwon extradited to the U.S. on prior charges. Montenegro has no extradition treaty with either Singapore or South Korea — both affiliated with Terraform Labs — but has an old treaty with the U.S.
However, it is unclear if Do Kwon is a U.S. citizen or technically committed a crime against U.S. citizens. When approached for comments, the representatives of the two accused men declined.
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Since September 2022, Do Kwon has been on the Interpol red notice, with an arrest warrant issued for him for his role in the crash of the $40 billion valued Terraform Labs in May.
Do Kwon’s role in Terraform Labs crash
At the height of its glory in 2022, LUNA, the Terra native token, was worth a whopping $40 billion. A much-hyped coin, it was further powered by the bravado of the prideful co-founder, Do Kwon, who once famously replied to his detractors,
“I don’t debate the poor.”
Until it came crashing.
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Kwon was on a mission to have $10 billion worth of BTC backing UST and had already accumulated $1.4 billion. Then, the price of BTC began to tank; China began its crackdown on BTC, and UST lost its $1 peg. All of these led to LUNA crashing, leaving many investors in limbo.
Subsequently, some legal documents, as reported by a South Korean news outlet, revealed that Do Kwon liquidated Terra Labs Korea Corporation a couple of days before the UST stablecoin crashed. The ill timing of this event was said to have made many feel he was guilty of improper conduct.
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