Do Kwon and Terraform have been charged by US authorities.
The failed cryptocurrency and its creato have been indicted on counts by the US Securities and Exchange Commission related to "orchestrating a multi-billion dollar crypto asset securities fraud" after the Singapore-based fund, which created Terra Luna and TerraUSD, failed in 2022; a collapse that is believed to have cost investors more than $40 billion.
Gary Gensler, the chair of the SEC said: "We allege that Terraform and Do Kwon failed to provide the public with full, fair, and truthful disclosure as required for a host of crypto asset securities, most notably for Luna and TerraUSD.
"We also allege that they committed fraud by repeating false and misleading statements to build trust before causing devastating losses for investors."
Do Kwon and Terra Labs did not respond to a request for comment when approached by BBC News.
According to the SEC’s allegations, Do Kwon and his business dealings raised billions by selling "an interconnected suite of crypto asset securities" with many of the transactions going unregistered.
The financial body also claim that the tokens would go up in value and were inaccurate about TerraUSD's stability.
At the time of its failure, Do Kwon - whose location was unknown to authorities until recently - said: "I am heartbroken about the pain my invention has brought on all of you.”
The SEC complaint did not specify where Do Kwon’s whereabouts prior to arrest when the arrest warrant was issued they spoke about believing he was in Serbia.
