Former members of the Terraform Labs (TFL) team have been questioned by the FBI and the Southern District of New York as part of a Justice Department-led investigation into the TerraUSD stablecoin debacle. The Wall Street Journal reported citing sources.
According to them, the Justice Department’s investigation covers the same areas as the SEC’s February lawsuit against the company and its management.
In particular, investigators became interested in the connection between South Korean payment company Chai and the TFL blockchain. The SEC accused TFL CEO Do Kwon of misleading the public about the processing of Chai’s transactions through their network, when in fact the service was using “more traditional techniques.”
U.S. prosecutors are also investigating communications between trading firms including Jump Trading Group, Alameda Research and Jane Street Group regarding the rescue of TerraUSD, according to Bloomberg News.
The scoop: Jane Street, Jump, and Alameda are facing scrutiny from U.S. attorneys for speaking in a Telegram group about the Terra bailout last May.
W/ @avabmorrison @allyversprille @ElleBeyoud pic.twitter.com/MKZ5tjOXm8
– Yueqi Yang (@Yueqi_Yang) March 13, 2023
The SEC has now filed civil charges against TFL and Do Kwon, accusing it of orchestrating a multibillion-dollar securities fraud. If the Justice Department filed charges, they would constitute criminal charges and could lead to prison time.
Recall that in early March, the Singapore police also launched an investigation into the company.
In December 2022, the media quoted the South Korean prosecutor’s office as saying that Kwon was hiding in Serbia. Representatives of the Ministry of Justice and the watchdog later clarified that the allegations were “not false”.
The TFL chief himself said he was not “at large” but was cooperating with law enforcement. In September, Bloomberg reported that Interpol had issued a “red notice” for his detention.
Subscribe to ForkLog on social networks
Found an error in the text? Select it and press CTRL+ENTER
ForkLog Newsletter: Keeping an Eye on the Pulse of the Bitcoin Industry
Information source: compiled from FORKLOG by 0x Information.The copyright belongs to the author Лена Джесс, and shall not be reproduced without permission