Do Kwon, the founder of Terra, has pleaded guilty in a New York court to two counts of conspiracy and fraud. The plea deal significantly reduces his possible prison time and sets the stage for his eventual transfer back to South Korea.
Originally facing eight criminal counts and a potential sentence of 130 years, Do Kwon admitted guilt to Count 1 and Count 4. By doing so, his maximum sentence drops to 25 years, and he gives up his right to appeal. As part of the agreement, prosecutors will recommend a sentence of no more than 12 years and will support transferring him to South Korea after he serves half of his sentence. However, Judge Paul Engelmayer made it clear that the final decision rests with the court, meaning the sentence could still exceed 12 years.
During the hearing, Judge Engelmayer asked Do Kwon to describe his crimes in his own words. Do Kwon stated, “I knowingly agreed with others in a scheme to defraud and in fact did defraud investors. What I did was wrong and I want to apologize for my conduct.” When pressed further, he admitted that he knew his actions were wrong at the time.
Under the terms of the deal, Do Kwon must also pay $19 million in forfeitures. The amount of restitution to investors has not yet been decided.
The next court conference is scheduled for December, when Judge Engelmayer could announce the final sentence.
This plea deal could mean Do Kwon serves as little as six years before being transferred to South Korea, depending on how the sentencing is finalized.
