The decision to transfer the Terraform co-founder to the United States or South Korea has been the subject of dispute in Montenegrin courts since 2023.
The Montenegro Appellate Court upheld a previous judgment to extradite Do Kwon, the co-founder of Terraform Labs, to his home country of South Korea on August 1.
Do Kwon’s repatriation to South Korea will be expedited, as there is no motion to appeal the extradition ruling, according to a court statement.
The recent ruling is likely the final in a series of legal battles, appeals, and reversals regarding the extradition of Kwon to the United States to face charges or to South Korea, which is likely a more favorable legal jurisdiction for the embattled South Korean native.
Terraform Labs and Kwon’s legal battle in the United States
Terraform Labs and its originator, Do Kwon, were held liable for fraud in April by a US court in a case presented by the US Securities and Exchange Commission (SEC).
Kwon and Terraform were both found guilty of six offenses in the April 5 verdict, which included the intentional misrepresentation of investors and the “reckless” mismanagement of customer funds.
Terraform Labs reached a $4.47 billion settlement with the Securities and Exchange Commission (SEC) in June of the same year.
The settlement comprised disgorgement fines of approximately $3.6 billion, a civil penalty of $420 million, and $467 million in interest payments on the fines. Judge Rakoff approved the SEC settlement on June 13, including approximately $204 million in legal penalties issued to Kwon.
Following the settlement, Terraform Labs declared that it would cease operations on June 12, 2024, and transfer control of the Terra ecosystem to the community.
Terraform Labs and the connection to the prime minister of Montenegro
Vijesti, a Montenegrin news outlet, asserted that the current prime minister, Milojko Spajic, was an early investor in Terraform Labs following the legal resolution between the company and the SEC.
According to the news outlet, the politician invested $75,000 in Terraform Labs in 2018 and received 750,000 LUNA tokens in return. This occurred just days before Terraform Labs was incorporated as a business entity in Singapore.
Spajic vigorously denied these allegations, asserting that Das Capital SG, a corporation he served as an employee for three years before his election to the presidency, was responsible for the investment.
