2023-11-06 20:37:01
SEC Clashes With Do Kwon and Terraform Labs in Court, Alleging ‘Clear, Undisputed’ Fraud On November 2, 2023, the U.S. Securities and Exchange Commission (SEC) advanced its case in the ongoing
Terra litigation by filing a motion for summary judgment. The regulatory body claims to hold
“undisputed” proof of the purported infractions committed by former Terraform Labs CEO Do Kwon and the company itself.
The SEC’s filing alleges that
“Terraform and Kwon orchestrated a fraudulent scheme that ultimately led to $45 billion in market loss, including devastating losses for U.S. investors.” The U.S. regulator believes the case is stacked against Terraform Labs and the former CEO.
“No rational jury could conclude that Kwon was not liable for Terraform’s violations,” the SEC filing insists.
The motion filed by the defense attorney
claims that despite a two-year investigation, which encompassed extensive discovery,
the SEC allegedly made no progress in demonstrating any misconduct by Kwon and the defendants. The defendants’ lawyers argued that even after a thorough probe, the evidence presented by the SEC against the accused remained static.
The SEC’s lawyers are not buying the argument and said,
“Kwon and Terraform then engaged in a scheme to defraud the public about [the] use and stability of these crypto asset securities.” The SEC insists that the
Terraform Labs startup and Kwon sold unregistered securities and performed unregistered and fraudulent spoofed blockchain transactions in order to commit fraud. Prosecutors argue that the defendants, meanwhile, “cashed out” a large sum of fiat currency.
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