Trial of ex-Terra chief postponed to March

At the moment, the businessman is being held in custody in Montenegro

17.01.2024 - 08:20

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What’s new? The New York court has postponed the start of the fraud trial of TerraForm Labs (TFL) founder Do Kwon from January 29 to March 25. The entrepreneur is currently in custody in Montenegro and will not be extradited until February-March at the earliest, according to his lawyer. The lawyer added that Kwon “has made every effort to be extradited from Montenegro as quickly as possible,” but the process is complicated by legal procedures and the fact that the businessman is serving a sentence in Montenegro on local charges.

Court ruling

What else is known? Judge Jed Rakoff in the US District Court for the Southern District of New York granted Kwon’s attorney’s request, though he emphasized there is no guarantee that the businessman will be released by the end of March.

Kwon is due to face a jury trial on fraud charges in connection with the May 2022 crash of the TerraUSD algorithmic stablecoin, which caused investors multi-billion dollar losses. Kwon then went on the run, only to be apprehended in Montenegro in March 2023 with forged documents while trying to fly to Dubai, for which he received four months in prison.

Investors from Korea, the United States, and Singapore have also filed class action lawsuits against Kwon.

Authorities in Korea, of which Kwon is a citizen, also filed a request for his extradition to Montenegro for a local trial. Butaccording to media reports, the Justice Department was leaning toward a decision to extradite him to the United States as early as late last year. Kwon later successfully challenged the extradition decision in Montenegro’s appeals court. The case was returned to the first instance court for reconsideration.

At the same time, Judge Rakoff granted summary judgment in favor of the US Securities and Exchange Commission (SEC) in its suit over the offer and sale of unregistered securities by Kwon and TFL.

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