Do Kwon may face trial in South Korea even after being sentenced to 15 years in the US

Source: PortaldoBitcoin Original Title: Do Kwon may face trial in South Korea even after being sentenced to 15 years in the US Original Link: Do Kwon’s legal troubles may be far from over. This is because South Korean prosecutors claim that the founder of the failed Terraform Labs still faces a separate criminal trial in his country, which could result in decades of imprisonment.

Do Kwon may be tried and convicted in his home country even after receiving a 15-year prison sentence last week in the United States for his role in the collapse of US$ 40 billion worth of TerraUSD and LUNA in 2022.

The South Korean citizen may apply for admission to the International Prison Transfer Program after serving half of his sentence in the US, with American prosecutors agreeing not to oppose the request as part of their plea agreement.

If extradited back to South Korea, Kwon will face charges including violations of the Capital Markets Act, which could add more than 30 years to his sentence.

“A conviction in Korea could result in a sentence of over 30 years,” said a senior prosecutor. “Prosecuting Do Kwon domestically would be the best way to compensate the local victims.”

In September 2022, the Seoul Southern District Prosecutors Office obtained an arrest warrant against Kwon. South Korean authorities estimate that about 200,000 victims in the country suffered losses totaling US$ 204 million (300 billion won).

The fall of Do Kwon

Kwon was co-founder of Terraform Labs, based in Singapore, which issued the TerraUSD stablecoin and the cryptocurrency LUNA.

The company claimed that Terra would maintain its parity with the US dollar through the Terra Protocol, but the system collapsed in May 2022, leading to a massive contagion in the market, resulting in the closure of other companies in the sector and massive losses for investors.

Later, US prosecutors discovered that an investment firm hired by Terraform Labs secretly bought Terra to artificially inflate its price.

Kwon was arrested in Montenegro in March 2023 while attempting to travel with a forged passport. After months of legal battles over extradition, during which Kwon filed a lawsuit to be transferred to South Korea instead of the US, he was finally extradited to the US last December.

US district judge Paul Engelmayer sentenced Kwon to 15 years in prison on Thursday after finding him guilty of nine charges, including fraud and money laundering. Although prosecutors had requested 12 years, the court imposed a longer sentence and ordered the confiscation of US$ 19 million in ill-gotten gains.

During the trial, the court received 315 impact letters from victims detailing cases of suicide, bankruptcy, and health crises following the collapse.

Sentiment in South Korea

“In South Korea, there is a widespread feeling among victims that seeing Do Kwon punished in the US may be more meaningful than a resolution within the national territory,” said cybersecurity expert David Sehyeon Baek.

“This is because the South Korean legal system is broadly seen as relatively lenient when it comes to large-scale financial crimes, even when damages are huge,” Baek added.

“When large-scale financial crimes are classified as ‘business failures’ rather than serious crimes, the message conveyed is one of tolerance, not accountability.”

Baek stated that Do Kwon could not convincingly claim ignorance, saying that the risks were no longer theoretical and that Kwon understood that a collapse would harm investors.

Moving forward despite everything was equivalent to accepting that risk, he said, noting that “hoping it will work” does not eliminate the awareness that it could fail.

“This caused great harm to people,” Baek said. “People are not guinea pigs.”