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Terra’s Do Kwon allegedly has $100 million stored in a Swiss bank

Terra’s Do Kwon reportedly had millions of dollars in a Sygnum bank account in Switzerland. US officials want action. But complex jurisdictional issues arise with the SEC’s involvement.

Swiss banks are known as a haven for investors and for their strict privacy laws. While Swiss bank secrecy laws have recently been relaxed, banks in the country are still known for their discretion and discretion. However, this reputation has made Swiss banks a popular destination for those seeking to hide their assets, including money gained through illegal activities.

Regulators and prosecutors have had difficulties dealing with Swiss banks due to the complex nature of their operations and the strict privacy laws that govern them. Swiss banks usually have many subsidiaries and affiliates in different jurisdictions, which makes it difficult to track the movement of funds and identify the individuals behind them.

The bank involved in the Terra and Do Kwon case is Swiss-based Sygnum Bank, which provides custody, trading and lending services for cryptocurrency and other digital assets. It is one of several banks operating in the rapidly growing cryptocurrency financing industry. While it is true that the bank owns billions of dollars in crypto assets, the bank is subject to Swiss banking laws and regulations, as well as international laws relating to anti-money laundering (AML) and counter-terrorist financing (CTF).

encryption connection

Regulators have recognized the unique challenges posed by crypto finance, including the difficulty of tracking the movement of funds and identifying the individuals behind them. However, there have been efforts to put in place regulatory frameworks and guidelines for the industry and ensure that it does not incite financial crime.

Dan Song Han, head of the Financial Securities Crime Joint Investigation Department, is leading the investigation. source: digital assets

Seoul prosecutors suspect that Terraform Labs and its co-founder, Do Kwon, still have a significant amount of cash. He holds a Swiss bank account of around 130 billion won ($100 million). This follows recent legal action against ten Terraform Labs partners. Including co-founder Shin Hyun-Seong, aka Daniel Shin. Do Kwon, on the other hand, was now under arrest for fake documents in Montenegro, and was the alleged coordinator in the $60 billion implosion of the Terra stablecoin and the collapse of its LUNA token.

South Korean prosecutors and the Securities and Exchange Commission believe there was a link to a Swiss bank account. according to local journalistafter 16 February indictment From Terraform Labs, Do Kwon and his colleagues allegedly transferred 10,000 Bitcoin (BTC) to Sygnum Bank.

The Seoul Southern District Prosecutor’s Office has been closely monitoring Bitcoin traffic linked to Terra and revealed this information during a press conference discussing the indictment.

However, attorneys representing Do Kwon argued that the SEC violated the law with its actions against the company and the bank. It asserted that the US regulators acted outside their jurisdiction in the Terra case.

Troubleshooting

When the Securities and Exchange Commission takes action against a bank registered in a foreign country. Several court cases may arise, as in the case of Terra. These issues can complicate the legal process and make it difficult for the SEC to pursue its proceedings.

Securities and Exchange Commission Chairman Gary Gensler testifying before Congress. Source: YouTube
Securities and Exchange Commission Chairman Gary Gensler testifying before Congress. source: Youtube

One of the court cases is which state has authority over the bank in question. This can be particularly difficult if the bank operates in multiple countries or if its activities cross international borders. In such cases, the SEC may need to work with other regulators, such as those in the bank’s home country, to coordinate its actions and ensure that its efforts do not conflict with those of other regulators.

A related issue is determining the laws and regulations governing the Bank’s activities. This can be very complicated if the bank is subject to different regulatory regimes in other countries. For example, a bank registered in a foreign country may be subject to US securities laws if it sells securities to US investors. Even if it is not registered with the SEC. At the same time, the Bank is subject to the laws of its home country.

Another complex question is whether legal activities in the home violate laws or regulations in other countries. For example, a bank may comply with the rules and regulations of its country of origin. However, it may violate US securities laws if it sells securities to US investors without proper registration or disclosure. In such cases, the SEC may need to work with foreign regulators to find out what actions to take.

The world’s financial policeman?

Additionally, what determines whether the SEC can take action against a bank? This may depend on the bank’s US connections. Like if it had a physical presence there, and did deals with American investors. or engaged in other activities that could be subject to US jurisdiction. In some cases, the SEC may need to establish jurisdiction over the bank through legal action in US courts.

Finally, the SEC may need to consider the potential impact of its actions on other countries and their regulatory systems. For example, if the Securities and Exchange Commission takes action against a bank registered in a foreign country, that country may retaliate against US banks operating within its borders. This may lead to a mutual escalation of regulatory actions, which will eventually harm the global financial system.

To address these jurisdictional issues, the SEC may need to work closely with foreign regulators and other stakeholders to coordinate its actions and ensure that its efforts are effective and appropriate. This may include formal information sharing agreements and protocols. Coordinating enforcement actions, engaging in continuous dialogue and cooperation with foreign regulators.

Play the world fishing game

The Securities and Exchange Commission (SEC) takes a tough stance against foreign companies and individuals that violate US securities laws. Including companies listed on US stock exchanges or issuing securities to US investors. be seen to divide 21(a)(2).

The agency has taken an increasingly active role in enforcing US securities laws globally in recent years. This included filing lawsuits against foreign companies engaging in fraudulent or fraudulent activities. Increased impact on US investors, individuals and companies that violate US sanctions or engage in other forms of financial misconduct.

Critics have accused the SEC of acting as the “financial policeman of the world.” Further overstepping its authority by pursuing cases not directly related to US investors or companies. They argue that this could create tension with other countries and their regulatory agencies. This then leads to disputes over jurisdiction and sovereignty.

Supporters of the SEC’s global enforcement efforts argue that it is necessary to protect US investors and ensure the integrity of the US financial system. They point out that financial misconduct often involves complex international transactions. Networks and cooperation between regulatory agencies in different countries are also necessary to combat these activities effectively.

Disclaimer

Following the Trust Project’s guidelines, this featured article features opinions and perspectives from industry or individual experts. BeInCrypto is dedicated to transparent reporting, but the opinions expressed in this article do not necessarily reflect those of BeInCrypto or its employees. Readers should verify information independently and consult with a professional before making decisions based on this content.

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