Extradition of Terraform Lab’s Do Kwon’s to South Korea Faces Supreme Court Review

Jimmy Aki
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On March 21, Montenegro’s Office of the Supreme State Prosecutor released a letter that challenged a recent court order to extradite Terraform Lab’s co-founder Do Kwon to South Korea.

This latest development would see Montenegro facing dual demands from the United States and South Korea, as the two countries plan to extradite Do Kwon for Terra’s collapse in 2022.

New Twist May Open Door to Do Kwon Extradition to the US

The initial ruling on the extradition destination for Do Kwon appeared to have been settled earlier this week, following Montenegro’s High Court’s decision to choose South Korea.

However, this took a different turn when Montenegro’s Office of the Supreme State Prosecutor announced procedural errors in the court’s ruling. Therefore, the case will be subjected to a review by the country’s apex court.

The prosecutor argued that the High Court’s ruling to extradite Kwon to South Korea rather than the United States was made in an “abbreviated proceeding” and exceeded the court’s jurisdiction authority. It was stated that the case ruling falls exclusively under the jurisdiction of the Justice Minister or the Supreme Court.

According to the prosecutor’s letter,

“The court, contrary to the law, conducted an abbreviated proceeding instead of regular proceeding and, by exceeding the limits of its powers, decided on the extradition permit, which is the exclusive competence of the Minister of Justice.”

Meanwhile, it should be noted that this conflicted decision between Montenegro’s Supreme Court and the High Court could pave the way for Do Kwon’s extradition to the United States.

It could be recalled that the Court in Podgorica, Montenegro, had in November 2023 approved that the crypto entrepreneur should be extradited to either the United States or South Korea.

Since the news of the High Court’s ruling to extradite Do Kwon to South Korea broke out, the United States Department of Justice (DOJ) has announced plans to seek further legal clarification.

According to a Bloomberg report, the DOJ will continue to pursue Do Kwon’s extradition under relevant international and bilateral agreements and Montenegrin law.

A United States court has indicted Do Kwon on eight charges. These include fraud, market manipulation, and instrumental to the collapse of the Terra ecosystem.

He also faces allegations of fraud and several breaches of capital markets law in South Korea.

Do Kwon’s lawyers have previously indicated that he would rather be extradited to his native country to be closer to his family, where he might be facing a 40-year jail term.

Insights into Do Kwon’s Case and Potential Effect of Extradition Verdict

Do Kwon escaped into hiding after the collapse of Terraform Lab in 2022.

However, he was apprehended within the territory of Montenegro in March 2023 over possessions of fake passports, along with his associate Han Chang-joon, who was deported to South Korea in February 2024.

The former CEO had a brief bail stint but served at least four months in jail over the fake passport incident and was then transferred to extradition custody.

Case observers and legal experts believed that even if Do Kwon’s extradition follows the same route as Han Chang-joon, the South Korean government could still agree with the United States to have his first trial in New York.

Many high-profile figures in the crypto space have been thoroughly investigated and indicted for deceptive practices in the United States.

This includes Sam Bankman-Fried, Changpeng Zhao, and Alex Mashinsky, who are scheduled to be convicted or face criminal charges for their roles in FTX, Binance, and Celsius, respectively.

However, there is a growing belief that the extradition of Do Kwon to the United States might uncover hidden criminal activities. This can also help to recover assets and funds, which will be used to create a reimbursement plan for victims.

In contrast, a potential extradition to South Korea is seen as less effective and may lead to several stalls and no recovery of Kwon’s assets.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.