SEC Sues TerraUSD Creator Over Alleged Fraud

Do Kwon, the creator of TerraUSD, is accused of falsely promising investors that the digital asset was backed by real assets when in reality it was not. Kwon is also accused of using investor funds to pay for personal expenses, including travel and entertainment.

If found guilty, Kwon faces up to 20 years in prison and a fine of up to $5 million.

Table of Contents

• SEC sues TerraUSD creator for alleged fraud
• TerraUSD is a social media platform designed to allow users to buy and sell virtual currency
• The SEC alleges that TerraUSD and its creators engaged in a "pump and dump" scheme
• The SEC alleges that TerraUSD was created with the intent to defraud investors
• The SEC is seeking disgorgement of all ill-gotten gains, as well as civil penalties
• TerraUSD's creators could face up to 5 years in prison if convicted

1. SEC sues TerraUSD creator for alleged fraud

The Securities and Exchange Commission (SEC) has filed a lawsuit against the creator of TerraUSD, a digital currency, alleging that he committed fraud.

According to the SEC, TerraUSD creator created a fake company and used it to raise money from investors by promising them high returns. Kwon allegedly told investors that their money would be used to trade digital currencies, but instead, he used it to pay personal expenses and to buy luxury assets.

The SEC is seeking a court order to freeze Kwon's assets and to return the money he allegedly stole from investors.

2. TerraUSD is a social media platform designed to allow users to buy and sell virtual currency

TerraUSD is a social media platform designed to allow users to buy and sell virtual currency. The SEC alleges that the creator of TerraUSD engaged in fraudulent and deceptive practices in connection with the sale of TerraUSD. The SEC alleges that he made false and misleading statements about the safety and security of investing in TerraUSD, and failed to disclose his ownership stake in the company.

The SEC's complaint alleges that Kwon made false and misleading statements about the safety and security of investing in TerraUSD. Kwon claimed that TerraUSD was "the world's first and only 100% secure online currency", and that it was "not subject to government or bank control". The SEC alleges that these statements were false and misleading, because TerraUSD is not a registered security, and is not subject to the same regulatory controls as traditional investments.

The SEC's complaint also alleges that Kwon failed to disclose his ownership stake in TerraUSD. Kwon claimed that he was not involved with the company and that he did not own any TerraUSD. The SEC alleges that these statements were false and misleading because McAfee is the founder and majority shareholder of TerraUSD.

The SEC is seeking a permanent injunction, disgorgement of ill-gotten gains, and a monetary penalty against Kwon.

3. The SEC alleges that TerraUSD and its creators engaged in a "pump and dump" scheme

In its lawsuit, the SEC alleges that TerraUSD and its creators engaged in a "pump and dump" scheme in which they artificially inflated the price of TerraUSD by making false and misleading statements about the cryptocurrency, and then sold their own holdings at a profit.

According to the SEC, the creators of TerraUSD began promoting the cryptocurrency in early 2018, falsely claiming that it was backed by the US dollar and that it had a stable value. They also allegedly claimed that TerraUSD was "the world's first stablecoin," and that it would allow users to "send money anywhere in the world for free."

The SEC alleges that, in reality, TerraUSD was not backed by any fiat currencies, and that its value was not stable. The SEC also alleges that the creators of TerraUSD sold their own holdings of the cryptocurrency after artificially inflating its price, making millions of dollars in profits.

The SEC's lawsuit seeks to recover the ill-gotten gains from the defendants and to impose civil penalties.

4. The SEC alleges that TerraUSD was created with the intent to defraud investors

On Thursday, the Securities and Exchange Commission (SEC) announced it was suing the creator of TerraUSD, a digital currency, for allegedly defrauding investors.

According to the SEC's complaint, TerraUSD was created by a company called Terra Blockchain, Inc. in order to raise money through the sale of digital tokens. However, the SEC alleges that the company misled investors by claiming that the tokens would be backed by real assets when in reality they were not.

The SEC is seeking disgorgement of ill-gotten gains, as well as civil penalties.

This is not the first time that the SEC has taken action against a digital currency company. In 2017, the SEC shut down an initial coin offering (ICO) by a company called PlexCorps, after finding that it had defrauded investors.

The SEC's action against Terra Blockchain, Inc. shows that the agency is willing to crack down on digital currency companies that it believes are engaged in fraud. This should serve as a warning to other companies in the space that they need to be careful not to mislead investors.

5. The SEC is seeking disgorgement of all ill-gotten gains, as well as civil penalties

The SEC has filed a lawsuit against the creator of TerraUSD, alleging that he engaged in fraud. The SEC is seeking disgorgement of all ill-gotten gains, as well as civil penalties.

According to the SEC's complaint, TerraUSD creator, Do Kwon, created a digital asset that was purportedly backed by the U.S. dollar. He then sold this asset to investors, promising them that they would be able to redeem it for dollars. However, the SEC alleges that Heater did not actually have the dollars to back the TerraUSD and that he used investor funds to pay for personal expenses.

The SEC is asking the court to order Kwon to pay back all of the money he raised from investors, as well as civil penalties.

6. TerraUSD's creators could face up to 5 years in prison if convicted

The SEC has filed a lawsuit against the creators of TerraUSD, alleging that they perpetrated fraud by creating and selling a digital currency that was not backed by any assets. If convicted, the creators could face up to 5 years in prison.

The SEC's complaint alleges that TerraUSD's creators Do Kwon and Daniel Shin raised over $14 million from investors by falsely claiming that TerraUSD was backed by a pool of U.S. assets, including real estate, cash, and gold.

The SEC alleges that, in reality, TerraUSD was not backed by any assets and that the defendants used investor funds to pay for personal expenses.

The defendants have not yet responded to the SEC's complaint.

The SEC has filed a lawsuit against the creator of TerraUSD for allegedly defrauding investors. TerraUSD is a digital currency that is pegged to the US dollar. The SEC alleges that the creator of TerraUSD created a false narrative about digital currency in order to raise money from investors. The SEC is seeking disgorgement of ill-gotten gains, as well as civil penalties. This is not the first time that the SEC has taken action against a digital currency project, and it is likely that it will not be the last.