SEC’s securities fraud allegation reportedly dismissed by Do Kwon lawyers
According to reports, the attorneys for Do Kwon, a co-founder of Terraform Labs, argued in court against the charges brought by the US Securities and Exchange Commission (SEC). Kwon was sued by the federal authorities for allegedly defrauding US investors by marketing unregistered securities in violation of the law.
Do Kwon’s attorneys requested that the judge dismiss the SEC action on April 21 on the grounds that the acquisitions made by the regulator were unsubstantiated. Kwon’s attorneys argued that US law forbade authorities “from using federal securities law to assert jurisdiction over the digital assets in this case,” according to Bloomberg, in their plea to have the action dismissed.
Additionally, according to the attorneys, the SEC failed to demonstrate that Kwon deceived US investors in connection with Terra’s $40 billion collapse of the cryptocurrencies TerraUSD (UST) and Luna (LUNA). The disputed stablecoin is a currency, not a security, according to the attorneys.
Do Kwon was detained on March 23 in Podgorica, Montenegro, while attempting to board a flight to Dubai using forged travel documents. This marked the beginning of the legal process. Both South Korean and American officials asked for the entrepreneur’s extradition after his arrest.
Which nation, if any, would have the best chance of getting Kwon extradited is still unknown as of this writing.
Shin Hyun-Seong, a co-founder of Terraform Labs, recently had an arrest order denied by the Seoul Southern District Court.
Despite the fact that the court rejected the motion and unverified claims were used as justification, the prosecution saw Kwon’s arrest as a chance to bring Shin to justice.
“In the case when we receive several extradition requests, I would like to say that determining to which state they will be extradited is based on several factors like the severity of the committed criminal offense, the location and time when the criminal offense has been committed, the order in which we have received the request for extradition and several other factors,” said the minister of justice in Montenegro, Marko Kovač, through an interpreter.