Terraform Labs, the company behind Terra LUNA/USD, has reportedly laundered $4.8 million through a South Korean shell company.
What Happened: According to a report from South Korean publication KBS News, a former developer at Terraform Labs told the publication that Terraform Labs had ties to a “blockchain consulting firm K” based in Seoul.
The employee said that "Company K" was “operated under a borrowed name by Terra.”
The office staff also reported that their workspace was named “Terra” in the building’s floor plan, but has since been removed.
The report also states that the National Tax Service uncovered a transfer of 6 billion won or $4.8 million sent from Terra to Company K, reported as “other expenses.” The company’s officials denied all allegations that it was affiliated to Terra in any way.
A deeper analysis from Terra Research Forum’s FatMan links Company K to Kernel Labs, an entity allegedly established by the same creators of Terraform Labs.
FatMan also shared screenshots of Terra’s T2 proposal, which mentions Terraform Labs and Kernel Labs as the same entity. Any mention of Kernel Labs in the T2 proposal has since been removed.
Korean tax officials have reportedly confirmed that they fined TFL for tax evasion after flagging suspicious transactions to Kernel Labs.
Last month, Terra founder Do Kwon refuted all allegations in relation to tax evasion on his part or by Terraform Labs.
Price Action: According to data from Benzinga Pro, LUNA was trading at $6.32 at press time, down 11.7% over the last 24 hours. Bitcoin BTC/USD was trading at $29,800, down 5.66% and Ethereum ETH/USD was trading at $1,813, down 6.34% over the same period.
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