As part of their investigation into Terraform Labs, the authorities in South Korea have placed a hold on about 104.4 million dollars belonging to the company’s co-founder Shin Hyun-Seong.
Reports from local media outlets indicate that the Seoul Southern District Court has placed a temporary freeze on the funds that are suspected of having been stolen while further investigations are carried out. (1)
Following a request from the prosecuting attorneys, the District Court granted the motion to freeze Shin’s assets, which totaled more than 104 million dollars.
Allegations Against Shin Hyun-Seong
Authorities in South Korea have leveled allegations against the company’s co-founder, alleging that he engaged in unethical business practices by obtaining approximately 140 billion Korean won worth of LUNA cryptocurrency prior to the official issuance of the cryptocurrency without providing adequate disclosure to regular investors.
Shin is the subject of an investigation by the authorities in South Korea about allegations that he made unethical profits from the issuance of in-house tokens such as LUNA and TerraUSD (UST).
In addition, he is being accused of breaching his responsibility to Chai Corporation, the payments technology company he founded, by utilizing the personal information of Chai Corporation’s customers to promote Terra’s cryptocurrencies. This is one of the allegations that he is facing.
According to a statement, “Prosecutors think that Chai Corporation released customer payment information to Terraform Labs without permission in the course of launching the Terra payment service in 2018.”
This information was leaked during the process of launching the Terra payment service. Prosecutors in South Korea have conducted searches at the corporate offices of Chai Corp. as part of an ongoing investigation.
In July, as part of the ongoing investigation, authorities conducted a search warrant at the residence of Daniel Shin.
As part of their investigation into the failure of Terraform Lab, prosecutors in South Korea issued a summons to Shin earlier this month, requesting that he appear in court.
Do Kwon Already Under Investigation
Since the extraordinary failure of Terra’s algorithmic UST stablecoin and sister LUNA cryptocurrency in May, the authorities in South Korea have been focusing on the company’s founder, Do Kwon, and other Terra collaborators.
Kwon, a citizen of South Korea, is accused of breaking the country’s law governing capital markets after prosecutors classify Terraform’s Luna cryptocurrency, which is now known as Luna Classic, as security. On September 14, a South Korean court issued an arrest warrant for Kwon and five of his associates because Kwon broke the law. The now-defunct stablecoin issuer, on the other hand, has dismissed the allegations as baseless.
Earlier in the week, Do Kwon sent a series of tweets in which he reiterated that the project was not associated with any fraudulent operations of any kind. Kwon asserted that he is “not making any attempts to conceal” and that he is eager to assist any government agency that wishes to connect with him.
11/ So why does this even matter?
It is natural to suspect fraud when something goes wrong, but if we sweep all failures in crypto as scams and say, "there are some bad apples but everything else is fine", then we never have opportunities to learn from our mistakes.
— Do Kwon 🌕 (@stablekwon) November 16, 2022