Following a couple of years spent in inactivity, the Yeouido-based prosecutorial and investigative group called ‘Grim Reapers’ has been revived by the latest South Korean President to dip into the disarray originated from Terraform Labs. This scenario is mounting pressure on Do Kwon – the unsuccessful crypto project Terra’s co-founder – as he could undergo extreme consequences.
The participants of the special prosecutorial and investigative team belong to the diverse financial regulators with a focus on the prosecution of fraudulent trading schemes and securities-related scams. Shin Hyun-Seong and Do Kwon, in addition to the Terra team’s participants, are likely at risk. On Wednesday, it was assured by SBS News (a news outlet in Korea) that the initial case to be handled by the restored Securities Crimes Joint Investigation Team would be that of Terra.
SBS News was informed by a team representative that extreme damage has been caused by the Terra case to the ordinary residents and this became a cause that pushed them to examine the matter as their earliest investigation. The restoration of the vigorous investigative group may be counted as a political step taken on the behalf of Yoon Seok-yeol – the newly elected conservative President – contradicting the decision that the former administration of the liberal Moon Jae-in to disperse it.
Nonetheless, the grandeur that the Terra case possesses is elaborated through the notion that it is the opening case that the investigators are going to tackle in a couple of years. The group received the nickname The Grim Reapers because of the high-profile cases dealt with by it. Among the biggest cases under the team was the pilfering scandal of approximately $1.2B worth by Lime Asset Management. In advance of the completion of the investigation, the group got disbanded, and – thus – the reopening of that case is also expected.
Before the dispersion of the team, it performed 346 arrests dealing with 965 cases that were prosecuted between 2013 and 2020. LUNA (Terra) is a blockchain that is based on layer-1. Luna and UST (Terra USD) – a stablecoin – were both considered among the prominent cryptos in terms of market capitalization until, on 8th May, a huge UST sell-off took place, causing a death spiral due to which the losses of billions were witnessed throughout the market. The market capitalization of Terra on 8th May was nearly $24.8B, however, it stands on just $959M at present, as per CoinGecko.
Several within the community are of the view that Kwon is the culprit behind the Terra collapse. In addition to this, a group of South Korean Terra investors intends to take Kwon to a criminal court regarding fraud and civil court in the matter of damages. They will request the court to put a seizure on Kwon’s assets as well.
As reported on 18th May by Moonwha Ilbo (translated Cultural Journal), the legal group engaged with the criminal case is to prosecute per the Capital Markets Act, which takes account of regulating the crypto industry’s financial areas nevertheless crypto-related laws may replace it
