crypto

Terraform Labs and Former CEO Settle with SEC for $4.5 Billion in Crypto Fraud Case

The Big Whale

— 1 min read
  • Terraform Labs and Do Kwon to pay $4.5B to SEC in settlement agreement.
  • SEC seeks approval from Judge Rakoff for the proposed judgment.
  • Kwon to pay $204M personally, banned from public company roles.
  • Terraform's algorithmic stablecoin collapse led to $40B in losses.
  • SEC charges Terraform and Kwon with fraud and misleading investors.
  • Settlement includes disgorgement, civil penalties, and ban on crypto asset securities transactions.

Summary :
Terraform Labs and its former CEO Do Kwon have agreed to a settlement with the U.S. Securities and Exchange Commission (SEC) in which they will pay a total of $4.5 billion in disgorgement and civil penalties. The settlement, which is still pending court approval, also includes a permanent ban on Kwon and Terraform Labs from buying and selling crypto asset securities. The SEC stated that if approved, the settlement will send a strong message to those who engage in misconduct and attempt to evade securities laws. In April, a jury found Kwon and Terraform Labs liable for civil fraud charges related to the collapse of the Terra ecosystem in 2022. Kwon is currently in custody in Montenegro awaiting a decision on his extradition to face criminal charges.

Sources :

- TheBlock
- Blockworks
- Bankless
- CoinTelegraph
- Decrypt
- Coindesk

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