Do Kwon is reportedly being sued by Terra Investors for fraud

South Korean investors are apparently ready to sue Do Kwon for fraud following Terra's collapse last week.


Terra Luna is being sued
Terra Luna | Image: Optimisus

LKB & Partners, a South Korean legal firm, is apparently prepared to sue Terraform Labs co-founder and CEO Do Kwon for fraud on behalf of investors who were affected financially by Terra's failure last week.


Terra's terrible collapse looks to be spreading beyond the cryptocurrency market and into South Korea's legal system.


South Korean investors who lost money due to Terra's unexpected collapse last week are going to sue Terraform Labs co-founder and CEO Do Kwon for fraud, according to a Wednesday article from local media Munhwa Ilbo.


According to the newspaper, the impacted investors are requesting that his property be temporarily seized.


Further, Kim Hyeon-Kwon, a partner at LKB & Partners, a top South Korean law firm representing the investors says the company is working on filing a police report against Kwon with the Seul Metropolitan Police Agency.


"There are linked investors inside the law company, and we want to file a complaint against CEO Kwon with the Seoul Metropolitan Police Agency's Financial Investigation Unit," he told Munhwa Ilbo.


According to the newspaper, the firm plans to file a request with the Seoul Southern District Public Prosecutors' Office next week to seek provisional seizure of Kwon's property.


Separately, social media speculation and various reports from local news agencies suggest that Kwon and another Terra co-founder, Daniel Shin, could face multiple lawsuits in South Korea from a variety of investors.


"There are linked investors inside the law company, and we want to file a complaint against CEO Kwon with the Seoul Metropolitan Police Agency's Financial Investigation Unit," he told Munhwa Ilbo.


It comes after the collapse of Terra's UST and LUNA tokens sent Kwon and Shin's creation into a death spiral last week.


Since then, Terraform Labs, the business formed by Kwon and Shin to launch Terra, has been dealing with the aftermath, with some Terra enthusiasts pushing for the development of a new ecosystem without the company's involvement.


Following Terra's demise, the business's in-house legal team of Marc Goldich, Lawrence Florio, and Noah Axler quit, leaving the corporation without an internal legal counsel.


Kwon will likely have to explain the Terra catastrophe to the South Korean government in addition to confronting LUNA and UST investors in court.