Criminal Charges Filed Against Do Kwon

U.S. prosecutors have filed criminal charges against former Terraform Labs CEO Do Kwon, estimating that the collapse of the TerraUSD and Luna cryptocurrency affected over one million victims.

“While it is difficult to precisely quantify the number of Kwon’s victims … the Government estimates that the number of victims in this case exceeds hundreds of thousands of individuals and entities, and potentially totals more than one million,” Acting US Attorney Daniel Gitner wrote in a court filing submitted on Monday.

In the alleged crypto fraud scheme, prosecutors claim Kwon built the Terra ecosystem on “lies” and “manipulative and deceptive” techniques to deceive investors into believing it was a functioning and reliable financial system.

“Ultimately, investors suffered over $40 billion in losses as a result of Kwon’s fraud,” the filing stated.

Due to the number of potential victims, U.S. prosecutors noted it is “impracticable” to send individualized notices to each victim about their rights. Instead, they requested the court post a public notice of the proceedings online.

Kwon faces multiple criminal charges in the U.S. stemming from his extradition from Montenegro last week. Charges include commodities fraud, securities fraud, wire fraud, and money laundering conspiracy. If convicted on all counts, he could face a maximum penalty of 130 years in prison.

In a New York court last week, Kwon pleaded not guilty. His next court appearance is scheduled for Jan. 8, according to Reuters.