South Korea makes its first arrest in connection with Terra ecosystem collapse.
South Korean authorities have arrested an executive of TerraForm Labs (TFL), the company behind the collapsed Terra tokens, LUNC and USTC.
A Korean local news outlet reported today that Yoo Mo, TFL’s Head of General Affairs, was arrested recently, following an intensive investigation into the Terra incident.
It is noteworthy that Mo was among the TFL’s executives that South Korean prosecutors issued with an arrest warrant last month. Since the announcement was made, Mo alongside other key TFL executives, including Do Kwon had been on the run. He ran out of luck recently and was arrested by Korean authorities.
Charges Slammed Against Mo
According to the report, Mo was arrested for allegedly violating capital market laws, breach of duty, and fraud, among other charges. The authorities claimed that Mo owned malicious bots that manipulated the price of Terra tokens before the collapse, the report noted.
This fraudulent act gave the public the impression that Terra tokens have a high trading volume, thus luring investors to get involved with the digital currencies.
Earlier today, Seoul Southern District Court was already making efforts to issue a direct judgment of warrant for Mo, which would be a major factor to determine whether to keep the TFL executive under custody.
Increased Probe Into Terra Collapse
The recent development adds to the continuous probe of TFL, which began after the Terra ecosystem crashed in May, and wiped off over $40 million. The unfortunate collapse prompted South Korea to rebirth a specialized crime unit that will conduct deep investigations into the actual cause of the incident.
Since the unit was relaunched, several reports have emerged indicting TFL’s founder Kwon, and other key Terra executives. Kwon was invited for questioning on multiple occasions but failed to show up, prompting the authorities to issue an arrest warrant for him and other top TFL execs. International policing organization, Interpol, subsequently issued a red notice for the Terra boss.
So far, Kwon’s location is still unknown. However, Kwon has continued to dismiss reports that he is not “on the run” and that he has chosen to keep his current location private due to the severe threats he has received from aggrieved investors.