Cryptocurrency Terra founders agree to $4.47 billion fine with U.S. authorities

Cryptocurrency issuing company TerraForm Labs and its co-founder Kwon DoHyoung are set to file a $4.47 billion (USD) lawsuit against the U.S. Securities and Exchange Commission (SEC) in connection with the collapse of the value of Terra Luna.
According to court records in the Southern District of New York, the SEC has agreed to pay restitution and penalties to TerraForm Labs and Kwon.
In a civil lawsuit against the company, legal representatives for both sides have reached an agreement on the amount of fines and other charges and have sought court approval.
The final settlement amount is less than the $5.26 billion the SEC initially proposed.
In November 2021, the SEC filed a civil lawsuit against Kwon and TerraForm Labs, alleging that they falsely promoted the stability of Terra and caused significant losses to investors.
This action was separate from the criminal proceedings against Kwon and did not require the defendant's personal appearance, so it proceeded in Kwon's absence.
The jury found that TerraForm Labs and Kwon had falsely claimed that Terra was safe and misled investors.
Following the jury's verdict, the SEC ordered TerraForm Labs and Kwon to pay a total of $5.26 billion in damages, including disgorgement of illicit profits and penalties.
In its opinion, the SEC argued that "Kwon and TerraForm Labs obtained more than $4 billion in unjust profits through their illegal conduct," and stated that the fine was appropriate.
TerraForm Labs responded by arguing that the issuance and sale of cryptocurrencies took place primarily outside the United States, denying the SEC’s justification for the fine.
After Kwon was arrested in Montenegro last year, New York prosecutors charged him with securities fraud, wire fraud, commodity fraud and other crimes.
The indictment covers eight charges, including conspiracy to manipulate the market. Kwon was arrested in Montenegro in March last year on suspicion of passport forgery. However, he has also been indicted in South Korea and is currently under arrest.
The delivery destination has yet to be decided.