handcuffs, judge gavel, and law book

South Korea prosecutors fail to secure arrest warrant for Terra co-founder anew

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Prosecutors in South Korea have failed in their latest attempts to secure an arrest warrant for Terra co-founder Daniel Shin after the court turned down their request for the second time.

A district court denied the Seoul Southern District Prosecutors Office’s pre-trial warrant for Shin for his role in the collapse of Terra’s ecosystem in March 2021. The court said prosecutors failed to show beyond the burden of proof that Shin was a flight risk or showed a propensity to tamper with evidence.

The court noted that Shin had a streak of complying with investigations from law enforcement agencies since the start of the fiasco. In 2022, the court denied applications for Shin’s arrest on similar grounds, but officials from the prosecutor’s office stated that they would amend their motion for another application.

The Prosecutor’s Office alleges that Shin had breached specific provisions of the Capital Markets Acts by promoting LUNA tokens. Law enforcement agents claim that Shin netted $100 million from the sale of pre-issued tokens that he failed to disclose to early investors.

There is also the allegation that Shin violated the Financial Supervisory Service (FSS) directive not to promote Terra tokens as a means of payment because it breached the Electronic Financial Transactions Act.

“The report to the effect that Shin realized profits by disposing of Luna at the peak, or that he made profits in other fraudulent ways, is different from the truth,” said Shin’s lawyer.

In his defense, Shin pointed out that he had nothing to do with Terra’s collapse as he left his role at the project to float Chai Corporation. Both Shin’s private residence and Chai’s office complex have been repeatedly raided by law enforcement in search of evidence confirming Shin’s involvement.

Do Kwon’s arrest brings the debacle to its final chapter

After nearly 12 months on the run, Kwon was arrested at the Podgorica airport in Montenegro while attempting to travel to Dubai. Following Kwon’s arrest, South Korea and the U.S. are now embroiled in a tussle for his extradition, but it remains unclear where the pendulum will swing.

Montenegrin Justice Minister Marko Kovac confirmed that the extradition requests would be settled based on several factors, including the severity of the criminal action, the location of the act, and the order of extradition requests.

Going on these factors, South Korea is in a pole position to secure Kwon’s extradition following a February visit by the country’s official to Serbia to begin preliminary discussions, weeks before his arrest.

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