- Do Kwon faces new money laundering conspiracy charge following Montenegro extradition.
- US Attorney’s Office alleges transactions exceeding $10,000 involving illegal proceeds.
- New charge adds to existing eight felony counts from 2023 indictment.
- Superseding indictment unsealed on January 2, 2024 in Southern District of New York.
- Prosecution claims Kwon knowingly processed proceeds from illicit activities.
Do Kwon’s Legal Troubles Mount with New Money Laundering Charge
The United States Department of Justice has expanded its case against former Terraform Labs executive Do Kwon, adding money laundering conspiracy to his existing eight felony charges. The development follows Kwon’s extradition from Montenegro, where he had been detained.
Details of the New Charge
According to the superseding indictment filed by US Attorney Damian Williams in the Southern District of New York, Kwon allegedly:
- Processed transactions exceeding $10,000
- Knowingly handled proceeds from illegal activities
- Coordinated with other individuals in the scheme
Background Context
The new charge supplements the 2023 indictment, which included:
- Securities fraud
- Wire fraud
- Market manipulation
Terraform Labs, under Kwon’s leadership, created the Terra/Luna ecosystem – a cryptocurrency network that suffered a catastrophic collapse in May 2022, resulting in approximately $40 billion in losses for investors. The algorithmic stablecoin system (a cryptocurrency designed to maintain a fixed value through automated supply adjustments) failed to maintain its dollar peg, leading to a market-wide cryptocurrency selloff.
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