Korean court gets new evidence that Terra Kwon deceived investors with fake transfers

South Korean prosecutors have found new evidence that Terra founder Do Kwon conspired with former Chai CEO Shin Hyun-Sung to deceive investors with fake transactions.

Terraform Labs co-founder Kwon Do-Hyeong, a central figure in the Earth and Moon token collapse, allegedly conspired with former Chai Corporation CEO Shin Hyun-Sung, to deceive investors with fake transactions, according to a report by Yonhap News Agency.

The Seoul Southern District Prosecutor's Office reportedly submitted new evidence to the court, revealing a May 2019 chat between Kwon and Shin discussing the payment app Chai, which Terraform used to process millions of transactions for Korean consumers.

In the chat, Kwon told Shin that he could "create fake transactions that looked real," adding that the app could dilute the number of fake transactions as it grew, making them "indistinguishable," according to the report. Shin accepted the project, suggesting to "test it on a small scale and see what happens."