Former Terra CFO Accused of Fraudulent Marketing, According to Report

Crypto News- It’s been reported that South Korean authorities have taken Han Chang-joon, the former Chief Financial Officer of Terraform Labs, into custody on Thursday. According to local news, he’s accused of making unfair profits totaling 53.6 billion Korean won ($40 million) through allegedly fraudulent marketing of the Terra stablecoin.

Han’s arrest comes after he was extradited from Montenegro on Monday, following his arrest last March for attempting to travel with forged documents. This incident involved Terra co-founder Kwon Do-hyeong, also known as Do Kwon.

Former Terra CFO Accused of Fraudulent Marketing, According to Report

Reports suggest that Seoul prosecutors allege Han participated in fraudulent cryptocurrency sales by misleadingly promoting Terra as a viable real-world payment option. A former Terra developer testified during Monday’s trial in Seoul, claiming that Terraform Labs executives were aware of regulatory obstacles preventing Terra’s use in payments. However, Terra co-founder Shin Hyun-seung argued that regulators hadn’t provided clear guidelines on cryptocurrency payments.

Additionally, Han faces charges related to selling Luna cryptocurrency without proper securities registration, as well as leaking around 100 million financial records of Chai Pay customers to the Terra blockchain. Chai Pay, a payments company founded by Terra co-founder Shin Hyun-seung (Daniel Shin), had close ties with Terraform Labs.

As for Do Kwon, he awaits a decision on extradition while being held in custody in Montenegro. Local authorities are still deliberating whether to extradite him to the U.S. or South Korea, with his detention period expected to end on Feb. 15.