Montenegro Court Says Terra Founder Do Kwon Should Remain in Jail

   2023-05-24 19:05

Montenegrin police officers escort an individual who is believed to be one of the most wanted fugitives, South Korean citizen, Terraform Labs founder Do Kwon in Montenegro's capital Podgorica, Friday, March 24, 2023
Do Kwon has pleaded not guilty to charges he faked passports and tried to leave Montenegro. He’s facing even more serious charges in both the U.S. and South Korea.Photo: Risto Bozovic (AP)

It turns out that Do Kwon, the man whose Terra stablecoin led to a $40 billion loss in the crypto industry, won’t get out of jail for a few hundred thousand dollars. On Wednesday, a Montenegrin court nixed an earlier deal to give Kwon bail, meaning the man will have to remain in jail while awaiting trial over allegations he tried to skip town on fake passports.

Last week, state prosecutors filed an appeal against the court’s decision to grant bail. Earlier this month, Kwon and his compatriot, former Terra chief financial officer Han Chong–joon, were granted a limited release on a mere $430,500 bond. As proposed during the pre-trial bail hearings, the two were also restricted to an apartment setting with the girlfriend of the pair’s attorney, Branko Andjelic. Police were meant to enforce rules keeping the pair tied to that apartment.


A mere week after prosecutors appealed, Bloomberg reported that the high court of the Montenegrin capital of Podgorica overturned the basic court’s decision and denied Kwon and Chong-joon bail. This puts it back to the lower court, which now has to come up with new terms that must take into account the higher courts ruling. This could mean a variety of back and forth between the upper and lower judiciaries.

Montenegrin police arrested the Terraform Labs execs back in March for allegedly trying to leave the country using fraudulent Belgian and Costa Rican passports. Both Kwon and Chong-joon have pleaded not guilty, though they are both still awaiting trial. It’s an open question whether Montenegro will send Kwon and co to South Korea or the U.S. after the trial is completed. Both countries are working to extradite the failed crypto founder over massive allegations of fraud and conspiracy for their role in talking up the Terra stablecoin before its eventual collapse.


In the meantime, several former Terra execs and staff members are up on charges in South Korea regarding their alleged roles in propping up the not-so-stable stablecoin. Unlike Kwon, Terra co-founder Daniel Shin and nine other former staff are being prosecuted without detention.

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