Do Kwon heading into extradition custody in Montenegro after receiving bail: Report

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The Terra Labs co-founder will be held for up to six months while the Montenegrin court considers South Korea’s extradition request.

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Terraform Labs co-founder Do Kwon will reportedly be taken into extradition custody in Montenegro, according to a report by the regional edition of Radio Free Europe (RFE). He also faces questions about ties to a local political figure.

A spokesperson for the High Court of Montenegro told RFE that Kwon was ordered into custody for six months while the court decides on South Korea’s extradition request for him. A Seoul court issued an arrest warrant for Kwon in September. His case has been called “the largest financial fraud or financial securities fraud case that has ever happened in South Korea.”

The United States has also requested Kwon’s extradition to face charges by federal prosecutors and the U.S. Securities and Exchange Commission.

The Montenegrin Basic Court has scheduled a hearing on June 16 on charges against Kwon and former Terraform Labs chief financial officer Han Chong-joon of falsified travel documents. They were arrested on March 23 at the airport in Podgorica, Montenegro, while attempting to depart for Dubai.

Related: Prosecutor says Do Kwon’s extradition to South Korea would best serve Terraform Labs’ victims: Report

Kwon is also expected to be questioned by the Special State Prosecutor’s Office about his ties to politician Milojko Spajić. Kwon claimed to have had contact with Europe Now party leader Spajić in a letter he sent to several officials just days before the latest round of elections in Montenegro.

Spajić denied ties to Kwon, but their alleged connection and possible financial contributions from Kwon were heavily covered by news outlets in the country.

Lawyers for Kwon and Chong-joon initially received approval for their proposed 400,000 euro ($436,000) bail for each man, but that decision was reversed on appeal before the appeal was dismissed.

Terraform Labs’ Terra ecosystem collapsed in May 2022, leading to losses estimated at up to $40 billion.

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