The SEC discovered a suspicious payment of $166 million from Terraform Labs to the company's lawyers
The U.S. Securities and Exchange Commission has identified suspicious movement of funds at Terraform Labs. The company paid $166 million to lawyers, transferring most of the amount before filing for bankruptcy.
The U.S. Securities and Exchange Commission (SEC) has discovered suspicious movement of funds from the failed Terraform Labs company. We are talking about the amount of $ 166 million, which was paid to the firm's lawyers, writes The Block.
The agency demanded that the Delaware Bankruptcy Court refuse to involve the defendant in the process of the Dentons U.S. LLC law firm. SEC representatives claim that this firm had previously participated in the withdrawal of funds from the company that could be used to pay for executive decisions.
The commission revealed that 90 days before the bankruptcy, the office received $122 million from Terraform Labs. The law firm later received another $44 million from the company. The agency believes that the funds could have been withdrawn to a so-called "non-transparent fund" with the expectation of using them to finance a legal confrontation with the SEC.
Representatives of the Commission note that more than half of the amount has already been spent to cover the costs associated with various processes. Dentons U.S. LLC has $81 million remaining in its account. The US authorities state that the firm cannot represent the interests of the defendant until it returns the funds previously spent.
According to the SEC, the company used some of the money to pay bills for consulting the former CEO of Terraform Labs, Do Kwon. We are talking about the case of the extradition of an entrepreneur from Montenegro.
