The multibillion-dollar collapse of Terra Labs’ stablecoin and the LUNA token is still ringing across the cryptocurrency industry, and numerous questions for Terra’s South Korean founder, Kwon Do-hyung, have emerged from the debris of wasted investments and shattered blockchain ideals.
In the midst of the Terra disaster, Do Kwon, the company’s founder, is being investigated by the South Korean authorities for possible tax evasion. A law company has also decided to file a lawsuit against him in order to seize his assets.
Terra’s Founder $78 Million Tax Evasion Charges
Do Kwon, Terra’s founder was reportedly ordered by South Korea’s National Tax Service to pay 100 billion won (roughly $78 million) in taxes just days after Terraform Labs’ legal team jumped ship.
The CEO has been under fire since the network’s demise. He has, however, laid forth some plans in an attempt to resuscitate the Terra Chain.
The tax authorities in South Korea found Terra’s parent firms, The Ancore Company and Terraform Labs, guilty of dodging corporation and income tax, according to South Korean news outlet Naver.
Terraform Labs had sent LUNA from its Singapore-based firm to the Luna Financial Guard, according to the authorities’ findings (LFG).
The National Tax Service of South Korea decided that funds were moved to LFG in order to avoid paying taxes.
Despite the fact that LFG and Terraform Labs were founded in Singapore, South Korean tax officials determined that they must pay taxes in the country because of their “place of actual management.”
A South Korean senator had raised his voice earlier to summon Kwon to look into the Terra crash.
Related reading | Mike Novogratz Speaks: Terra’s UST Was “A Big Idea That Failed”
Terra LUNA, a cryptocurrency with a market valuation of more than $40 billion, crashed in less than a week. According to the article, Terra’s founder, Terraform Labs, and other executives were recently notified by the National Tax Service that they must pay a 100 billion won charge. However, in June 2021, the agency launched a special tax probe into Terra’s parent firm.
LUNA/USD crashed below $1 peg over last week. Source: TradingView
According to the research, CEO Kwon owns 92% of Terra Singapore. While Daniel Shin, the CEO of Chai Corporation, who previously denied any connection to Terra, owns about an 8% stake. Meanwhile, Chin is listed as a registered director of the company in the report.
Following an inquiry by the South Korean Tax Agency in October, Terra Virgin was fined 4.66 billion won (about $3.64 million) in income tax. A corporate tax of 44.47 billion won (about $34.7 million) was also imposed on the company. The tax authorities further stated that the Terra founded the Luna Foundation Guard (LFG) in order to avoid paying taxes.
Popular Law Firm Moves To Sue
One of South Korea’s biggest law firms, LKB & Partners, has also decided to sue Terraform Labs’ founder.
According to a report in the Munhwa Ilbo daily, LKB would launch a complaint against Kwon, a Korean national, on behalf of regular investors with the Seoul Metropolitan Police Agency. According to the article, several of LKB’s workers may join the action because they lost money in the UST collapse.
According to the report, in addition to submitting a police complaint, LKB has decided to file a provisional attachment order of Kwon’s properties in the Public Prosecutors’ Office of Seoul Southern District to take them.
LKB is reportedly considering suing Daniel Shin, another Terra co-founder, according to a second story from Korean news outlet Yonhap.
Related article | Terra – A ‘Pyramid Scheme’ – Threatens The Crypto Ecosystem, Billionaire Says
Featured Image by Getty images | Charts by TradingView
You can get bonuses upto $100 FREE BONUS when you:
💰 Install these recommended apps:
💲 SocialGood - 100% Crypto Back on Everyday Shopping
💲 xPortal - The DeFi For The Next Billion
💲 CryptoTab Browser - Lightweight, fast, and ready to mine!
💰 Register on these recommended exchanges:
🟡 Binance🟡 Bitfinex🟡 Bitmart🟡 Bittrex🟡 Bitget
🟡 CoinEx🟡 Crypto.com🟡 Gate.io🟡 Huobi🟡 Kucoin.
Comments