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Claim review. Fraud

Supported

The cited record supports the material proposition.

The US Securities and Exchange Commission said that on 5 April 2024 a New York jury found Terraform Labs and Do Kwon liable for defrauding investors in crypto asset securities.

liable for defrauding investors in crypto asset securities
About
Terraform Labs PTE Ltd
Claim made by
US Securities and Exchange Commission, regulator statement
Published
5 April 2024
Original
Statement on Jury's Verdict in Trial of Terraform Labs PTE Ltd. and Do Kwon
Evidence score
94 How it was scored
Last reviewed
25 October 2026

Why this label

The SEC statement records a jury verdict of liability for fraud after a nine day trial in the Southern District of New YorkS1. The later SEC release repeats that a jury unanimously found Terraform and Kwon liable for securities fraudS2. This was a civil finding on the balance of the evidence, not a criminal conviction. The parties then settled in June 2024S2. The separate criminal case ended in a guilty plea and a 15 year sentence in December 2025S4. The record supports the claim as stated.

Current procedural position

Civil jury verdict of liability entered in the Southern District of New York on 5 April 2024S1. Settled by consent in June 2024S2.

Record supporting the assessment

found Terraform Labs PTE Ltd. and Do Kwon liable for defrauding investors in crypto asset securities
S1 Tier A US Securities and Exchange Commission (Gurbir S. Grewal, Division of Enforcement), Statement on Jury's Verdict in Trial of Terraform Labs PTE Ltd. and Do Kwon, 5 April 2024
deceived investors about the stability of the crypto asset security and so-called algorithmic stablecoin Terra USD
S1 Tier A US Securities and Exchange Commission (Gurbir S. Grewal, Division of Enforcement), Statement on Jury's Verdict in Trial of Terraform Labs PTE Ltd. and Do Kwon, 5 April 2024
a jury unanimously found Terraform and Kwon liable for securities fraud
S2 Tier A US Securities and Exchange Commission, Terraform and Kwon to Pay $4.5 Billion Following Fraud Verdict, 13 June 2024

Conflicting or limiting record

No record located that conflicts with this assessment.

Evidence score: 94 of 100

The score grades how well the record establishes this assessment. It is not a score of Terraform Labs PTE Ltd. Score = source authority + directness + corroboration + procedural accuracy + currency + reproducibility.

ComponentPointsMaxReason
Source authorityIs the source competent to establish the proposition?2930The SEC is the plaintiff and the competent securities regulator.
DirectnessDoes the source state the proposition or only discuss adjacent facts?1920The statement addresses the verdict and the fraud finding directly.
CorroborationDo independent records support the same material point?1415The SEC settlement release repeats the same finding.
Procedural accuracyDoes the record settle the procedural state the claim describes?1315A civil jury verdict of liability, then resolved by settlement, not a criminal conviction.
CurrencyHas the record been checked against later developments?1010Checked against the June 2024 settlement and the 2025 criminal outcome.
ReproducibilityCan a reader locate the passage and repeat the assessment?910The SEC statement is public on the SEC site.
Total94100

Timeline

  1. Jury finds Terraform and Kwon liableS1
  2. Consent judgment entered, settlement of more than US$4.5 billionS2

Related cases

  • SEC v. Terraform Labs PTE Ltd. and Do Hyeong KwonUS District Court for the Southern District of New York. Civil. 23-cv-1346 (JSR).Stage: Jury verdict of liability on 5 April 2024, resolved by consent judgment entered on 12 June 2024.
    • Jury finds Terraform and Kwon liable for securities fraudS1
    • Consent judgment entered, settlement of more than US$4.5 billionS2S9

Revision history

  • Assessment first published with label Supported.

Have a record that changes this assessment? See corrections and responses.

Sources

  1. S1Tier A Statement on Jury's Verdict in Trial of Terraform Labs PTE Ltd. and Do KwonUS Securities and Exchange Commission (Gurbir S. Grewal, Division of Enforcement). Regulator press release. 5 April 2024.Supports the civil jury verdict of liability for fraud. It is a statement on a civil verdict, not a criminal conviction.
  2. S2Tier A Terraform and Kwon to Pay $4.5 Billion Following Fraud VerdictUS Securities and Exchange Commission. Regulator press release. 13 June 2024.Supports the settlement figures and repeats the jury finding. The settlement resolves the civil case.
  3. S9Tier A SEC v. Terraform Labs PTE, Ltd. and Do Hyeong Kwon, No. 23-cv-1346-JSR (S.D.N.Y.)US Securities and Exchange Commission. Regulator press release. 18 September 2025.SEC distributions page. Supports the case number, the 12 June 2024 consent judgment and the 20 September 2024 Chapter 11 plan approval. Says payments run through the bankruptcy estate.
  4. S4Tier A Crypto-Enabled Fraudster Sentenced For Orchestrating $40 Billion FraudUS Department of Justice, US Attorney's Office, Southern District of New York. Government press release. 11 December 2025.Supports the 15 year sentence, the forfeiture of over US$19 million and the counts. This is the conviction record.

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