Terraform Founder Do Kwan Arrested in Montenegro, South Korea to Seek Extradition of Crypto Fugitive

South Korea will seek the extradition of fugitive crypto entrepreneur Do Kwon, prosecutors told AFP Friday, after the Terraform founder was arrested in Montenegro and hit with US fraud charges.

Kwon, whose full name is Kwon Do-hyung, has been accused of fraud over his company Terraform Lab’s dramatic collapse last year, which wiped out about $40 billion (roughly Rs. 3,31,166 crore) of investors’ money and shook global crypto markets.

The 31-year-old was arrested at the Podgorica airport in Montenegro on a South Korean warrant, the country’s interior ministry said Thursday.

Shortly after, the United States charged him with eight counts, including securities fraud and wire fraud, which followed a lawsuit by the US Securities and Exchange Commission.

In South Korea, where Kwon is wanted for violations of the country’s capital markets act, authorities confirmed Friday that they would seek his extradition.

“South Korean prosecutors will take steps to repatriate Kwon Do-hyung. We are working on the process,” Kim Hee-kyung, a spokeswoman for the Seoul Southern District Prosecutors’ Office, told AFP.

Kwon reportedly flew from South Korea to Singapore ahead of the company’s crash in May last year.

In September, Seoul prosecutors requested that Interpol place him on the red notice list across the agency’s 195 member nations, and also revoked his passport.

But questions about his whereabouts intensified after the Singapore Police Force said that he was not in the country.

Montenegro authorities said Thursday that Kwon had “used falsified travel documents from Costa Rica” during passport control for a flight to Dubai.

Inspection of their luggage also found travel documents from Belgium and South Korea, while Interpol checks discovered that Belgian documents were forged, Montenegro’s interior ministry added.

Many investors lost their life savings when Kwon’s Luna and Terra entered a death spiral, and South Korean authorities have opened multiple criminal probes into the crash.

South Korea’s National Police Agency said it would collaborate with the country’s prosecutors as they seek Kwon’s extradition.

“As an organisation that works closely with the Interpol, we will actively cooperate with the Seoul Southern District Prosecutors’ Office,” Jeong Beom-seok, an official from the National Police Agency, told AFP.

Cryptocurrencies have come under increasing scrutiny from regulators across the globe following a string of recent controversies, including the high-profile collapse of the exchange FTX.

Kwon is accused of “orchestrating a multi-billion-dollar crypto asset securities fraud”, according to the US Securities and Exchange Commission.