US authorities charge South Korean crypto developer Do Kwon with fraud

FILE – An American flag is displayed on the facade of the New York Stock Exchange on June 29, 2022, in New York. Investors had few places to hide in 2022: Stocks and bonds both nose-dived and crypto tanked. Pocketbook issues were front and center for consumers as prices for food, energy and rent jumped. (AP Photo/Julia Nikhinson, File)

A South Korean crypto developer was charged on Thursday by U.S. prosecutors for allegedly defrauding investors about his two digital currencies — Terra and Luna — that collapsed last year, according to news reports.

Do Kwon, who was arrested on Thursday by authorities in Montenegro, was indicted by Manhattan federal prosecutors who accused him of misleading buyers of digital currencies issued by Terraform Labs, a payment platform used for cryptocurrencies.

Prosecutors also said Kwon engaged in market manipulation with a U.S. trading firm so he could change the market price of Terra, Bloomberg reported. 

The indictment also alleges that Kwon made false and misleading statements on TV and on social media about his business. 

Kwon, who’s been evading charges from South Korea, was attempting to fly to Dubai using forged documents when he was arrested in Montenegro. 

This follows charges brought by the U.S. Securities and Exchange Commission on Wednesday against several celebrities, including Lindsay Lohan and Jake Paul, for promoting cryptocurrencies without disclosing that they were being paid for it.

Six of the celebrities who were charged agreed to pay more than $400,000 total to settle the allegations. 

Tags cryptocurrency DOJ SEC South Korea

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