Kwon’s Extradition Snag: SEC Trial Presses On Without CEO’s Presence

February 29, 2024

In February, a pivotal ruling by a Montenegrin court decreed that Do Kwon, the embattled CEO and co-founder of Terraform Labs (TFL), would be extradited to the United States rather than his homeland, South Korea, to face allegations of fraud. Following this judicial ruling, Kwon’s legal team notified a U.S. court that he would be unable to attend the initial hearings of the SEC trial.

In a recently submitted document to the court, which served as a status update and not a request for a postponement of the proceedings, Kwon’s legal team explicitly stated that the trial could proceed as scheduled on March 25, despite his absence, citing “Montenegrin extradition procedures” as the reason.

“Mr. Kwon’s extradition has proceeded on the ‘summary’ process as required by his consent to extradition to both the United States and South Korea. That process was meant to be resolved by this point, with Mr. Kwon being extradited to one of the two countries that have requested his extradition. However, his extradition has taken longer than expected because of unanticipated mistakes by the High Court tasked with deciding Mr. Kwon’s case,” defense lawyer David Patton said in a letter addressed to U.S. District Judge Jeff Rakoff.

Furthermore, Kwon’s legal team expressed their anticipation for a resolution to his extradition by this time. However, they acknowledged, based on the declaration from Kwon’s Montenegrin defense attorney Goran Rodic, that the 32-year-old South Korean entrepreneur would not be extradited by the end of March.

In January, Judge Rakoff declared the postponement of the trial of the U.S. Securities and Exchange Commission’s (SEC) $40 billion fraud case against the blockchain firm Terraform Labs and its co-founder and CEO Kwon until March following a request from Kwon’s camp.

The judge moved the start date of the SEC v. Terraform Labs trial to March 25 from the initial January 29 start date, underlining that “The Court will indulge his counsel’s request given their express recognition that the trial cannot be further postponed.”

Moreover, the SEC agreed to delay the civil litigation involving Kwon, strategically aligned with facilitating his extradition to ensure his presence during the trial.

Kwon’s legal woes began in March 2023 when he was apprehended at Podgorica airport while attempting to board a private jet bound for Dubai, using fraudulent travel documents. Since then, his extradition has become a point of contention between the U.S. and South Korea, each seeking jurisdiction to prosecute him in connection with the dramatic collapse of TerraUSD and Luna, which incurred a staggering $50 billion valuation loss within three days in May 2022.

Kwon has consistently denied allegations of fraud, much like his persistent denial of being on the run.


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