Prosecutors raid Terraform's parent firm in probe into Luna-Terra crash

Prosecutors have raided the parent company of Terraform Labs as part of a broadening investigation into the massive collapse of the firm's Luna and TerraUSD cryptocurrencies, sources said Sunday.

Last week, an investigation team of the Seoul Southern District Prosecutors Office conducted the search and seizure at the parent company currently headed by Terraform co-founder Daniel Shin, according to the legal sources.

As part of the raid, prosecutors also searched the home of the chief of another Terraform-related company suspected to be serving as its Korean branch as well as a Terraform subsidiary, the sources said.

Terraform is under an investigation for alleged fraud and tax evasion after investors in TerraUSD and Luna filed complaints against Terraform Labs' CEO Do Kwon and co-founder Shin in May, accusing them of fraud over the loss of billions of won following the crash of both coins earlier that month.

Last week, the investigation team raided seven local cryptocurrency exchanges, including Upbit, Bithumb and Coinone, and eight other places, including the homes and offices of people involved in the case.

The investigation team also secured Kwon's records from the tax authorities last month to look into suspicions he evaded taxes.

The latest search is widely seen as focusing on money flows between Terraform-affiliated firms and the development process of the cryptocurrencies. (Yonhap)