Terra Luna founder Do Kwon was apprehended in Montenegro and has been jailed on the Island ever since. However, various nations namely South Korea and the United States applied for an extradition of Kwon to carry out criminal proceedings against the accused.
However, Montenegro has rejected the extradition request citing incomplete legal requirements. The Appellate Court of Montenegro annulled an extradition order issued by high court of Podgorica in November to either the USA or South Korea.
According to a new announcement, the High Court of Podgorica set legal requirements for extradition of Kwon in November this year. The final decision on the matter was assigned to minister of justice of Montenegro. However, Kwon defense team was able to get an extension at the appeals court.
For now, the case has been redirected to Podgorica Basic Court for reprocessing. The High Court of Podgorica added comments in its decision noting that it was affected by significant violation of provisions of the Criminal Procedure Code.
Terra Co-founders to Face Defrauding Charges
Terreforma Labs collapsed in May, 2022 as per SEC filings. On this account, Kwon was charged with $40 billion fraudulent scheme. He was arrested in March 2023 in Montenegro and jailed for using fake travel documents. If his extradition request is completed, he can face multiple sentences in either South Korea or the United States.
Daniel Shin is another Terraforma Labs co-founder who is charged with defrauding investors. Shin has claimed that he left the firm in 2020 on account of business reasons. He has further retained that he does not have any connection with the downfall of the firm during trial proceedings at the Southern District Court of South Korea last month.
During the case proceedings, Shin told court that he had nothing to do with the fall of Terra/Luna project. At the same time, he claimed that the collapse of the project was imminent. In addition to Daniel seven other executives were presented at the Southern District Court of South Korea on 30th October.
South Korean prosecutors have accused Shin of defrauding investors and also put LUNA on trial as an unregistered security. Shin was working as CEO of payments processing firm called Chai that partnered with Terraform in 2019.
South Korean Investigators Seized $105 Million from Shin
Defense lawyers of Shin claimed that American Laws are not applicable in South Korea retaining that the local government has retained since 2017 that virtual assets are not classified as financial products such as securities and Capital Market Law is not applicable to it.
Meanwhile, South Korean regulators confiscated 140 billion won or $105 million from Shin in November 2022. Investigators alleged that Shin got the money by selling LUNA reserves while knowing that its price will crash.
Shin stayed in South Korea following Terraform Labs filed for bankruptcy in 2022. His first court appearance was in November last year. He was indicted for fraud charges in April. South Korean authorities have also issued arrest warrants for Kwon but he is currently in custody at Balkan nation Montenegro.
An X user, @FatManTerra posted an update on 15th November 2022 that Korean prosecutors have issued summon orders for Daniel Shin as part of the investigation regarding insider trading, breach of duty, and price manipulation at the expense of Chai investors.