Montenegro’s Constitutional Court cancels the decision on Do Kwon’s extradition

What’s new? On October 18, the Constitutional Court of Montenegro suspended the extradition of Do Kwon, the founder and former CEO of Terraform Labs. A day earlier, the Justice Ministry said that a decision on which country the businessman would be extradited to would be made public on October 20. Kwon has been on the run since the Terra blockchain crash and was detained in Montenegro last March before serving a prison sentence for passport forgery. His extradition for fraud trials has been requested by South Korean and US authorities.

Material by Balkan Insight

What else is known? The decision on Kwon’s extradition, including the destination, was referred by the Supreme Court to the Justice Ministry in September. In turn, the Constitutional Court suspended the extradition process pending a decision on Kwon’s appeal, without notifying the Ministry of Justice of the suspension until the last minute.

Kwon was detained at Podgorica airport while attempting to fly to Dubai on forged documents together with former Terraform Labs CFO Han Chang-joon. After Terra’s collapse, they lived in Serbia, and Kwon even launched a new business despite having an Interpol red notice issued against him in South Korea.

Kwon and Chang-joon are both South Korean citizens. They each served four months in prison for document fraud in Montenegro, and Chang-joon was extradited to his home country in February 2024.

As for Kwon, the decision on him has been repeatedly postponed and changed. Initially, the businessman was supposed to be sent to the United States, but South Korea was the first to file an extradition request, and in August the Justice Ministry changed its decision in its favor. Later, the decision was sent for review at the request of the prosecutor’s office. Kwon himself also appealed the High Court’s extradition decision.

Terraэs collapse due to the collapse of the UST stablecoin and LUNA token in May 2022 caused billions of dollars in losses to investors worldwide.

Kwon was found guilty of defrauding investors in a civil suit filed by the US Securities and Exchange Commission (SEC) in April this year. The businessman is believed to have retained access to his crypto wallets, as one of them transferred 1075 bitcoins worth $62 million in September.

Terraform Labs itself will pay $4,5 billion to the SEC as part of the peace agreement and wind down operations. It will perform a final blockchain update before handing the project over to the community.

Separately, criminal cases have been opened against Kwon and the development company in the United States and South Korea. Class action lawsuits have also been filed by investor groups in several countries around the world.