The SEC, or the United States Securities and Exchange Commission, has asked for huge sums of money in the form of disgorgement and fines against Terraform Labs and its founder, Do Kwon, as part of their ongoing civil lawsuit.
In a filing made to the U.S. District Court for the Southern District of New York on April 19, the Securities and Exchange Commission (SEC) asked that Kwon and Terraform Labs pay approximately $5.22 billion in total – including around $4.7 billion in disgorgement and prejudgment interest after a civil case ruling, and penalties of $520 million. The SEC, Terraform, and Kwon all submitted their arguments for potential remedies to the civil case at the same time. Terraform suggested a maximum penalty of $3.5 million, while Kwon proposed only $800,000.
Along with imposing a financial penalty, the SEC suggested preventing Kwon from holding executive or leadership roles in any securities company. Additionally, they demanded full disclosure of his financial records. If accepted, Terraform Labs would face a “behavior-restraining order” to halt similar deceitful practices that resulted in the extensive fraud. However, these proposed actions and civil penalty are yet to be approved by a judge.
The SEC filing stated that the defendants have failed to express regret for their actions, and it is clear that they are in a situation where further violations may occur. The court should deliver a clear warning against such flagrant misconduct and the defendants’ attempt to rewrite rules for crypto markets disregarding federal securities laws.
On April 5, a jury determined that Terraform and Kwon were accountable for deceiving investors concerning statements relating to the provision and trading of TerraUSD (UST), Luna (LUNA), and wLUNA. A representative from Terraform stated at that point that they were pondering their choices and potential subsequent actions. CryptoMoon attempted to contact Terraform regarding the April 19 filing but did not get a reply before publication. [
Kwon, one of Terraform’s co-founders, was absent from the SEC trial due to his ongoing legal issues in Montenegro. He was taken into custody in March 2023 after being found with forged travel documents while trying to depart from the country.
At the point when this article was published, Kwon’s travel within Montenegro was authorized but the decision regarding his extradition to the U.S. or South Korea was still undecided. He could potentially be charged with crimes in either country.
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2024-04-23 00:29