Seoul Prosecutors Request Arrest Warrant For Korean E-Commerce CEO Over Terra-Luna Fiasco

South Korean prosecutors want to make a major arrest related to the controversial collapse of the so-called algorithmic stablecoin TerraUSD (UST) and the native token of Terra network LUNA. They have requested an arrest warrant for the former chief executive officer (CEO) of a Korean e-commerce platform, TMON, for allegedly receiving bribes from the company's executive to promote Terra as a payment gateway.

The head of the financial and securities joint investigation team at the Seoul Southern District Prosecutor's Office has requested an arrest warrant for the bribery charges against the former TMON CEO whose identity was kept hidden and was only described as Mr. A, a local media outlet reported.

Along with another suspect described as Broker B, the former TMON CEO allegedly worked on lobbying in the financial sector to promote Terra, the report stated.

Mr. A is linked to Terra co-founder Shin Hyun-Seong or Daniel Shin, who supposedly asked him to promote Terra as a simple means of payment, which according to investigators, helped boost the price of Terra's crypto assets and raised investor's expectations.

As payment for his efforts in promoting the crypto business, the former CEO allegedly received LUNA tokens from Terra, which he eventually sold.

The report also noted that Shin, despite repeated warnings from financial authorities in South Korea, continued giving money to other businesses like TMON to promote LUNA as a safe payment method.

Interestingly, Danny Kumwong-Park, a staff writer at Forkast, noted that the prosecutor's request for the arrest warrant is still subject to review and approval from the local court before they could arrest the former TMON CEO.

"The request for the arrest warrant will need to be reviewed and approved by the local court before the former CEO is arrested," the staff writer shared on Twitter, adding that "the court will review the request on Friday."

The spectacular collapse of UST which dragged the ecosystem's native token LUNA wiped away billions of investors' funds in May 2022.

South Korean authorities are still looking for the CEO and founder of Terraform Labs Do Kwon, who is believed to be in the Balkans after he exited Singapore sometime in September.

Earlier reports confirmed that Kwon is in the Balkans after he allegedly withdrew 9.46 Bitcoin, equivalent to approximately $162,189 at the time, in one of the active Bitcoin ATMs in Serbia's capital Belgrade in December 2022.

Prosecutors along with a senior Justice Ministry official reportedly went to Serbia recently to seek local authorities' cooperation in arresting Kwon.