South Korean Police to Freeze Luna Foundation Guard Finances

According to KBS, South Korea’s official broadcaster, police authorities in the country are freezing assets linked to the non-profit group Luna Foundation Guard (LFG). According to the report, the Seoul Metropolitan Police Agency requested that LFG be barred from withdrawing business funds from various exchanges.

Reports state that the police interfered after discovering signs pointing to embezzled money within LFG. Some investors have already sued Terraform Labs founder Do Kwon following the latest Terra crisis, which saw the stable coin TerraUSD (UST) value plummet below $0.10.

A police official from the Seoul Metropolitan Police Agency was quoted as saying:

We have received information that there is a person suspected of embezzling corporate funds who is believed to be an employee of Terraform Labs.

At the moment, it is unclear how much money LFG has in its accounts. According to a recent news story, the organization was keeping around $2.8 million in various cryptocurrency exchanges. The Luna Foundation Guard was established to safeguard investors in the Terra project. The group’s first and primary goal is to hold Terraform Labs accountable for the management of the UST stable coin.

Do Kwon, the CEO of Terraform Laboratories, is already under investigation by South Korean authorities for tax evasion. The Grim Reaper, a police unit in charge of investigating financial crimes, is looking into his case.

The “Grim Reaper” is a specialized police unit that investigates high-profile felonies. Now, with the announcement by the Seoul Metropolitan Police Department that it has frozen the assets of the Luna Foundation Guard, Do Kwon’s problems appear to be just beginning.