Do Kwon And Terraform Labs Hit With $5.3 Billion Penalty From SEC in Terra-Luna Case
Terraform Labs and its founder, Do Kwon, are facing hefty financial trouble after the United States Securities and Exchange Commission (SEC) filed a motion on April 19. The SEC is demanding $5.3 billion in fines following the commission’s win in its civil Terra-Luna case against the crypto mogul.
The SEC’s filing in the U.S. District for the Southern District of New York seeks to make Kwon and Terraform Labs pay nearly $4.7 billion in disgorgement and prejudgment interest following the Terra-Luna case.
Kwon will also have to forfeit $100 million of his own funds in civil penalties, while Terraform Labs will have to pay $420 million, respectively.
#SEC seeks $5.3 billion against TerraformLabs & DoKwon after fraud verdict:
– Jury finds Terraform & Kwon liable for deceptive practices.
– SEC requests $4.7B in disgorgement and interest, plus $520M in civil penalties.
– In response, Terraform proposes a $3.5M penalty, Kwon… pic.twitter.com/ZDw8w7Vw3C
— @TheLordofEntry (@thelordofentry) April 23, 2024
On top of financial fees, the SEC has asked the court to bar Kwon from operating as a securities officer and director of any securities issuer, as well as to issue an injunction against both the crypto founder and Terraform Labs.
New’s of the SEC’s motion follows a substantial two-week long trial that found Kwon liable for fraud after the collapse of his algorithmic stablecoin, TerraUSD, and its sister token, Luna, prompted a $40 billion crypto market crash.
Kwon was not present at the landmark civil trial, however. Instead, he was stuck in Montenegro after the country confiscated his passport following his release from prison for using fake travel documents to escape legal consequences related to the crypto crash .
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