US charges Korean Crypto fugitive after reported arrest in Montenegro

Fugitive South Korean cryptocurrency entrepreneur Do Kwon, accused of orchestrating a multi-billion-dollar fraud that shook global crypto markets last year, has been arrested in Montenegro and faces fresh criminal charges in the United States.

Kwon was arrested along with another South Korean national, Montenegro’s interior ministry said Thursday, which added that the tycoon was apprehended on a South Korean warrant.

“Kwon Do-hyung and Han Chang-joon were arrested and brought to the state prosecutor’s office in Podgorica for the criminal act of document forgery,” an interior ministry statement said.

During passport control for a flight to Dubai the two “used falsified travel documents from Costa Rica, which was established also by Interpol checks”, it said.

Inspection of their luggage also found travel documents from Belgium and South Korea, while Interpol checks discovered that Belgian documents were forged, the ministry added.

Police seized from them three laptop devices and five mobile phones.

Their entry into Montenegro has not been registered, the ministry said.

South Korea has issued a warrant for them for the offence of “criminal association”, it added.

South Korea asked Interpol in September to circulate a “red notice” for the 31-year-old across the agency’s 195 member nations.

Kwon and five others connected to Terraform are wanted for fraud and the implosion of its digital currencies in May 2022.

The US federal indictment charged the 31-year-old Kwon with eight counts, including securities fraud, commodities fraud and wire fraud. The charges follow a lawsuit a month ago from the US Securities and Exchange Commission.

Kwon’s TerraUSD was designed as a “stablecoin,” which are pegged to stable assets like the US dollar to prevent drastic fluctuations in prices.

However, around $40 billion in market value was erased for the holders of TerraUSD and its floating sister currency, Luna, after the stablecoin plunged far below its $1 peg in May last year.

Kwon is accused of “orchestrating a multi-billion-dollar crypto asset securities fraud”, according to the US Securities and Exchange Commission.

– Death spiral –
Many investors lost their life savings when Luna and Terra entered a death spiral, and South Korean authorities had opened multiple criminal probes into the crash.

Cryptocurrencies have come under increasing scrutiny from regulators across the globe following a string of recent controversies, including the high-profile collapse of the crypto exchange FTX.

FTX and its sister trading house Alameda Research went bankrupt late last year, dissolving a virtual trading business that had been valued by the market at $32 billion.

The fall of FTX has caused major doubts about the long-term viability of cryptocurrency and heaped stress on further platforms and entities that rode the success of Bitcoin and other currencies.

To add to its mounting woes, the digital currency sector has also been hit hard by the demise of US crypto lenders Silvergate and Signature amid a string of banking failures that have rattled global markets and sparked fears of future economic turmoil.

bur-arp/st

© Agence France-Presse

Inflation eases to 6.1% in May

The country’s inflation rate eased to 6.1 percent in May, the lowest year-on-year figure recorded since July 2022, according to a report released by the Philippine Statistics Authority (PSA).

Read More »