Dishonest cheating in business illegal money

Prosecutors reveal Do Kwon’s lawyers received $7M before Terra’s implosion

South Korean prosecutors have discovered a payment worth $7 million to Kim & Chang, the legal representatives of Terraform Labs founder Do Kwon.

The lump sum was paid weeks before the eventual collapse of the project, which investigators say could serve as proof that company executives anticipated the implosion. Officials believe the funds were an advanced payment to the law firm ahead of a long-running legal battle with creditors and investigators.

“The fact that they sent a large sum of money to a large law firm before the crash should be seen as a situation in which they were prepared for judicial risks such as the prosecution’s investigation,” said one official from the Prosecutor’s Office.

Authorities say that the funds can be confiscated if it is proven in court that the amount stems from criminal proceedings under the guise of “legal fees.” Kim & Chang reportedly confirmed the payments saying that “it was difficult to confirm specific details of each case.”

Following Kwon’s arrest in Montenegro, Kim & Chang lawyers flew into the region to offer legal services to the embattled founder and Terra’s ex-chief financial officer, Han Chang-joon. Currently, Kwon is facing a herculean extradition battle with the U.S. and South Korea jostling over the rights to take him to trial.

South Korean authorities have been tracking the funds linked to Terra’s collapse but confirmed in a statement that they did not find a “single dollar” belonging to Kwon in the country. However, investigators have since contacted Binance and other digital currency exchanges to freeze Kwon’s funds on their exchanges.

“We provided Korean law enforcement authorities with the requested assistance,” said a Binance spokesperson, according to the report. The company added that it is precluded from disclosing details of the nature of its assistance to South Korean authorities, but it remains unclear if Kwon had assets on the platform.

Investigators had previously confiscated over $160 million worth of real estate from former Terra executives, including co-founder Daniel Shin.

Moving out funds

While none of Kwon’s assets are domiciled in South Korea, authorities say they traced $61 million directly to the Terraform Labs CEO. The U.S. Securities and Exchange Commission (SEC) disclosed that Kwon pilfered over $100 million worth of BTC in the days after the collapse.

Kwon was discovered to have created a consulting company while hiding in Serbia, which analysts posit could have been a ploy to launder some of his stolen funds. Despite an Interpol “red notice” issued against him, Kwon was able to float the new company using his invalidated South Korean passport.

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