South Korea Rebirths Specialized Crime Unit to Investigate Terra’s UST Collapse

Korean authorities believe Terra’s collapse is not properly investigated and as such it has revived a tactical crime unit to ensure no stone is left unturned in the Terra’s ecosystem collapse. 

Following the collapse of TerraForm Labs ecosystem tokens, including TerraUSD (UST) and LUNA, the South Korean government has revived one of its specialized financial crime units to investigate the real cause behind the massive dip of Terra’s tokens. 

Revived Crime Unit

According to local media SBS News, the Korean specialized crimes unit dubbed the “Yeouido Grim Reaper,” would be investigating the circumstances that led to the collapse of Terra tokens, which Korean authorities believe has not been properly investigated. 

“As the Luna and Terra case is a case of multiple damage to the common people, it was designated as the first investigation case by the Hap Sudan after an internal review by the Ministry of Justice,” a spokesperson for the unit commented. 

The group, which was disbanded over two years as part of prosecution reform, consists of over 40 people, including prosecutors and employees from different regulatory units, including the country’s Financial Service Commission (FSC) etc. 

The Bone of Contention

Part of the focus of the investigation will center on the method Terra used to lure people into investing in its ecosystem coins. 

Terra’s promise of a 20% ROI to investors who deposit to its Anchor Protocol is suspected of being a Ponzi scheme. 

This comes a few days after Korean authorities called on Terra’s founder and CEO Do Kwon to explain the main cause of the UST and LUNA collapse. 

Terra’s Devastating Blow

It is no longer news that Terra’s ecosystem suffered a devastating blow last week after its flagship stablecoin UST lost its peg to the United States Dollar. 

The fall of UST also plunged the price of LUNA from an all-time high of $125 recorded last month to a low of $0.00000009. 

Investors did not take their Terra losses lightly as some cases of suicide were reported. Similarly, an investor was alleged to have invaded Kwon’s residence in search of him, with many suggesting that the intruder had ulterior motives. 

Kwon Under Investigation for Tax Evasion

Meanwhile, an investigation into the cause of the collapse of UST should be the least of Kwon’s troubles, as a new report suggests that the firm’s CEO is being investigated for tax evasion. 

According to a report published by Edaily, Kwon is alleged to have invaded corporate and income tax to the tune of 100 billion won ($75 million). 

In a similar development, Korean tax authorities are also investigating Terra’s Luna Guard Foundation (LFG), with a 100 billion won fine ready to be slammed on the company.