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Do Kwon sentenced to 15 years in prison for $40 billion stablecoin fraud
Securities Class Action |
2025/12/10 22:00
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Onetime cryptocurrency mogul Do Kwon was sentenced Thursday to 15 years in prison after a $40 billion crash revealed his crypto ecosystem to be a fraud. Victims said the 34-year-old financial technology whiz weaponized their trust to convince them that the investment — secretly propped up by cash infusions — was safe.
Kwon, a Stanford graduate known by some as “the cryptocurrency king,” apologized after listening as victims — one in court and others by telephone — described the scam’s toll: wiping out nest eggs, depleting charities and wrecking lives. One told the judge in a letter that he contemplated suicide after his father lost his retirement money in the scheme.
Judge Paul A. Engelmayer said at a daylong sentencing hearing in Manhattan federal court that the government’s recommendation of 12 years in prison was “unreasonably lenient” and that the defense’s request for five years was “utterly unthinkable and wildly unreasonable.” Kwon faced a maximum sentence of 25 years in prison.
“Your offense caused real people to lose $40 billion in real money, not some paper loss,” Engelmayer told Kwon, who sat at the defense table in a yellow jail suit. The judge called it “a fraud on an epic, generational scale” and said Kwon had an “almost mystical hold” on investors and caused incalculable “human wreckage.”
Kwon pleaded guilty in August to fraud charges stemming from the collapse of Terraform Labs, the Singapore-based firm he co-founded in 2018. The loss exceeded the combined losses from FTX founder Sam Bankman-Fried and OneCoin co-founder Karl Sebastian Greenwood’s frauds, prosecutors said. Engelmayer estimated there may have been a million victims.
Terraform Labs had touted its TerraUSD as a reliable “stablecoin” — a kind of currency typically pegged to stable assets to prevent drastic fluctuations in prices. But prosecutors say it was an illusion backed by outside cash infusions that came crumbling down after it plunged far below its $1 peg. The crash devastated investors in TerraUSD and its floating sister currency, Luna, triggering “a cascade of crises that swept through cryptocurrency markets.”
Kwon tried to rebuild Terraform Labs in Singapore before fleeing to the Balkans on a false passport, prosecutors said. He’s been locked up since his March 2023 arrest in Montenegro. He was credited for 17 months he spent in jail there before being extradited to the U.S.
Kwon agreed to forfeit over $19 million as part of his plea deal. His lawyers argued his conduct stemmed not from greed, but hubris and desperation. Engelmayer rejected his request to serve his sentence in his native South Korea, where he also faces prosecution and where his wife and 4-year-old daughter live.
“I have spent almost every waking moment of the last few years thinking of what I could have done different and what I can do now to make things right,” Kwon told Engelmayer. Hearing from victims, he said, was “harrowing and reminded me again of the great losses that I have caused.”
One victim, speaking by telephone, said his wife divorced him, his sons had to skip college, and he had to move back to Croatia to live with his parents after TerraUSD’s crash evaporated his family’s life savings. Another said he has to “live with the guilt” of persuading his in-laws and hundreds of nonprofit organizations to invest.
Stanislav Trofimchuk said his family’s investment plummeted from $190,000 to $13,000 — “17 years of our life, gone” during what he described as “two weeks of sheer terror.”
Chauncey St. John, speaking in court, said some nonprofits he worked with lost more than $2 million and a church group lost about $900,000. He and his wife are saddled with debt and his in-laws have been forced to work well past their planned retirement, he said.
Nevertheless, St. John said, he forgives Kwon and “I pray to God to have mercy on his soul.”
A prosecutor read excerpts from some of more than 300 letters submitted by victims, including a person identified only by initials who lost nearly $11,400 while juggling bills and trying to complete college. Kwon had made Terra seem like a safe place to stash savings, the person said.
“To some that is just a number on a page, but to me it was years of effort,” the person wrote. “Watching it evaporate, literally overnight, was one of the most terrifying experiences of my life.”
“What happened was not an accident. It was not a market event. It was deception,” the person added, imploring the judge to “consider the human cost of this tragedy.”
Kwon created an “illusion of resilience while covering up systemic failure,” Assistant U.S. Attorney Sarah Mortazavi told Engelmayer. “This was fraud executed with arrogance, manipulation and total disregard for people.” |
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Top EU official warns the US against interfering in Europe’s affairs
Headline Legal News |
2025/12/06 22:00
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A top European Union official on Monday warned the United States against interfering in Europe’s affairs and said only European citizens can decide which parties should govern them.
European Council President Antonio Costa’s remarks came in reaction to the Trump administration’s new national security strategy, which was published on Friday and paints European allies as weak while offering tacit support to far-right political parties.
It’s “good” that the strategy depicts European countries as an ally, but “allies don’t threaten to interfere in the domestic political choices of their allies,” Costa said.
“What we can’t accept is the threat of interference in European political life. The United States cannot replace European citizens in choosing what the good or the bad parties are,” he said in Paris at the Jacques Delors Institute, a think tank.
Fabian Zuleeg, chief executive at the European Policy Centre think tank, said that stridently nationalist parties in Europe will be emboldened by the strategy document and “will intensify efforts to hollow out the EU from within.”
“Pro-European liberal forces need to finally wake up: Trump’s America is not an ally but an adversary to Europe’s freedoms and fundamental values. His objective is to replace our democratic system with the illiberal populism now entrenched in the U.S.,” Zuleeg said.
The strategy was also critical of European free speech and migration policy. U.S. allies in Europe face the “prospect of civilizational erasure,” the document said, raising doubts about their long-term reliability as American partners.
But Costa, who chairs summits of the 27 national EU leaders, said Europe’s “history has taught us that you can’t have freedom of speech without freedom of information.”
The former Portuguese prime minister also warned “there will never be free speech if the freedom of information of citizens is sacrificed for the aims of the tech oligarchs in the United States.”
Speaking to reporters in Berlin, German government spokesperson Sebastian Hille underlined that “Europe and the U.S. are historically, economically and culturally linked, and remain close partners.”
“But we reject the partly critical tones against the EU,” he said. “Political freedoms, including the right to freedom of expression, belong to the fundamental values of the European Union. We view accusations regarding this more as ideology than strategy.”
The security strategy is the administration’s first since President Donald Trump returned to office in January. It breaks starkly from the course set by President Joe Biden’s Democratic administration, which sought to reinvigorate U.S. alliances.
It comes as the U.S. seeks an end to Russia’s nearly 4-year-old war in Ukraine, a goal that the national security strategy says is in America’s vital interests.
But the text makes clear that the U.S. wants to improve its relationship with Russia after years of Moscow being treated as a global pariah and ending the war is a core U.S. interest to “reestablish strategic stability with Russia.”
Kremlin spokesman Dmitry Peskov has said the document “absolutely corresponds to our vision.” Over the course of the war, Russia has worked to drive a wedge between NATO allies, particularly between the U.S. and Ukraine’s main backers in Europe.
“If we read closely the part about Ukraine, we can understand why Moscow shares this vision,” Costa said. “The objective in this strategy is not a fair and durable peace. It’s only (about) the end of hostilities, and the stability of relations with Russia.”
“Everyone wants stable relations with Russia,” he added, but “we can’t have stable relations with Russia when Russia remains a threat to our security.”
Top EU officials and intelligence officers have warned Russia could be in a position to launch an attack elsewhere in Europe in three to five years should it defeat Ukraine. |
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Netflix to acquire Warner Bros. studio and streaming business
Stock Market News |
2025/12/01 21:59
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Netflix has struck a deal with Warner Bros. Discovery, the legacy Hollywood giant behind “Harry Potter” and “Friends,” to buy its studio and streaming business for $72 billion.
The acquisition, announced Friday, would bring two of the industry’s biggest players in film and TV under one roof and alter the entertainment industry landscape. Beyond its namesake television and motion picture division, Warner owns HBO Max and DC Studios. And Netflix is ubiquitous with on-demand content and has built its own production arm to release popular titles, including “Stranger Things” and “Squid Game.”
“For more than a century, Warner Bros. has thrilled audiences, captured the world’s attention, and shaped our culture,” David Zaslav, CEO of Warner Bros. Discovery, said in a statement. “By coming together with Netflix, we will ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come.”
The cash and stock deal is valued at $27.75 per Warner share, giving it a total enterprise value of approximately $82.7 billion. The transaction is expected to close after Warner separates its Discovery Global cable operations into a new publicly-traded company in the third quarter of 2026.
Shares of Warner Bros. rose nearly 3% in premarket trading while shares of Netflix and Paramount fell more than 2%.
Gaining Warner’s legacy studios would mark a notable shift for Netflix’s, particularly its presence in theaters. Under the proposed acquisition Netflix has promised to continue theatrical releases for Warner’s studio films — honoring Warner’s contractual agreements for movie releases.
Netflix has kept most of its original content within its core online platform. But there’s been few exceptions, such as limited theater screenings of a “KPop Demon Hunters” sing-a-long and its coming “Stranger Things” series finale.
“Our mission has always been to entertain the world,” Ted Sarandos, co-CEO of Netflix said in a statement — adding that merging with Warner will “give audiences more of what they love.”
Critics say a Netflix-Warner combo could have negative consequences for movie theaters worldwide. Cinema United — a trade association that represents more than 30,000 movie screens in the U.S. and another 26,000 screens internationally — was quick to oppose the proposed deal, which it said “poses an unprecedented threat to the global exhibition business.”
“Netflix’s stated business model does not support theatrical exhibition. In fact, it is the opposite,” Michael O’Leary, CEO of Cinema United, said Friday — urging regulators to look closely at the impacts. “Theatres will close, communities will suffer, jobs will be lost.”
Netflix had previously steered away from tapping into other parts of the legacy entertainment landscape. As recently as October — when Warner signaled that it was open to a potential sale of its business — Netflix’s Sarandos reiterated on an earnings call that the company had been “very clear in the past that we have no interest in owning legacy media networks” and that there was “no change there.”
“We believe that we can be and we will be choosy,” Sarandos said at the time, without fully ruling out a potential bid for Warner.
Friday’s announcement arrives after a monthslong bidding war for Warner Bros. Discovery. Rumors of interest from Netflix, as well as NBC owner Comcast, starting bubbling up in the fall. But Skydance-owned Paramount, which completed its own $8 billion merger in August, had also reportedly made several all-cash offers backed heavily by CEO David Ellison’s family.
Paramount seemed like the frontrunner for some time — and unlike Netflix or Comcast, was reportedly vying to buy Warner’s entire company, including its cable business housing networks like CNN and Discovery.
Warner announced its intention to split its streaming and studio operations from its cable business in June — outlining plans for HBO, HBO Max, as well as Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, to become part of a new streaming and studios company.
Meanwhile, networks like CNN, Discovery and TNT Sports and digital products such as the Discovery+ streaming service and Bleacher Report would make up a separate cable counterpart.
The Netflix acquisition of Warner’s streaming and studio arm is expected to close in 12 to 18 months — after the company wraps up the spinoff of its cable business. That is now expected in the third quarter of 2026.
The merger has already received approval from shareholders of both Netflix and Warner Bros. Discovery, but it faces significant regulatory hurdles.
The size of the transaction could draw antitrust scrutiny. Beyond TV and movie production, the merger would bring two of the streaming world’s biggest names — Netflix and HBO Max — under the same roof.
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Judge orders Trump administration to end National Guard deployment in DC
Court News |
2025/11/27 22:01
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A federal judge on Thursday ordered the Trump administration to end its monthslong deployment of National Guard troops to help police the nation’s capital.
U.S. District Judge Jia Cobb concluded that President Donald Trump’s military takeover in Washington, D.C., illegally intrudes on local officials’ authority to direct law enforcement in the district. She put her order on hold for 21 days to allow for an appeal, however.
District of Columbia Attorney General Brian Schwalb sued to challenge the Guard deployments. He asked the judge to bar the White House from deploying Guard troops without the mayor’s consent while the lawsuit plays out.
Dozens of states took sides in Schwalb’s lawsuit, with their support falling along party lines.
Cobb found that while the president does have authority to protect federal functioning and property, he can’t unilaterally deploy the D.C. National Guard to help with crime control as he sees fit or call in troops from other states.
After her ruling, Schwalb called for troops to be sent home. “Normalizing the use of military troops for domestic law enforcement sets a dangerous precedent, where the President can disregard states’ independence and deploy troops wherever and whenever he wants — with no check on his military power,” Schwalb said.
The White House, though, stood by the deployment.
“President Trump is well within his lawful authority to deploy the National Guard in Washington, D.C., to protect federal assets and assist law enforcement with specific tasks,” said spokeswoman Abigail Jackson. “This lawsuit is nothing more than another attempt — at the detriment of DC residents — to undermine the President’s highly successful operations to stop violent crime in DC.”
In August, President Donald Trump issued an executive order declaring a crime emergency in Washington. Within a month, more than 2,300 National Guard troops from eight states and the district were patrolling the city under the command of the Secretary of the Army. Trump also deployed hundreds of federal agents to assist in patrols.
The administration has also deployed Guard troops to Los Angeles and tried to send troops into Chicago and Portland, Oregon, prompting other court challenges. A federal appeals court allowed the Los Angeles deployment, and the administration is appealing a judge’s decision in Portland that found the president did not have the authority to call up or deploy National Guard troops there.
The Supreme Court is weighing the administration’s emergency appeal to be allowed to deploy National Guard troops in the Chicago area in support of an immigration crackdown. A lower court has indefinitely prevented the deployment.
In Washington, It’s unclear how long the deployments will last, but attorneys from Schwalb’s office said Guard troops are likely to remain in the city through at least next summer. |
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Trump says he’s terminating legal protections for Somali migrants
Topics in Legal News |
2025/11/22 22:01
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President Donald Trump said Friday night that he’s “immediately” terminating temporary legal protections for Somali migrants living in Minnesota, further targeting a program seeking to limit deportations that his administration has already repeatedly sought to weaken.
Minnesota has the nation’s largest Somali community. Many fled the long civil war in their east African country and were drawn to the state’s welcoming social programs.
But how many migrants would be affected by Trump’s announcement that he wants to end temporary protective status could be very small. A report produced for Congress in August put the number of Somalis covered by the program at just 705 nationwide.
Congress created the program granting Temporary Protective Status in 1990. It was meant to prevent deportations of people to countries suffering from natural disasters, civil strife or other dangerous conditions.
The designation can be granted by the Homeland Security secretary and is granted in 18-month increments.
The president announced his decision on his social media site, suggesting that Minnesota was “a hub of fraudulent money laundering activity.”
“Somali gangs are terrorizing the people of that great State, and BILLIONS of Dollars are missing. Send them back to where they came from,” Trump wrote. “It’s OVER!”
The Minnesota chapter of the Council on American-Islamic Relations said Trump’s decision “will tear families apart.” Executive Director Jaylani Hussein said in a statement late Friday, ”This is not just a bureaucratic change; it is a political attack on the Somali and Muslim community driven by Islamophobic and hateful rhetoric.”
Trump promised while campaigning to win back the White House last year that his administration would deport millions of people. As part of a broader push to adopt hardline immigration policies, the Trump administration has moved to withdraw various protections that had allowed immigrants to remain in the United States and work legally.
That included ending TPS for 600,000 Venezuelans and 500,000 Haitians who were granted protection under President Joe Biden. The Trump administration has also sought to limit protections previously extended to migrants from Cuba and Syria, among other countries. |
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Investment Fraud Litigation |
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Securities fraud, also known as stock fraud and investment fraud, is a practice that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of the securities laws. Securities Arbitration. Generally speaking, securities fraud consists of deceptive practices in the stock and commodity markets, and occurs when investors are enticed to part with their money based on untrue statements.
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The content contained on the web site has been prepared by Securities Law News as a service to the internet community and is not intended to constitute legal advice or a substitute for consultation with a licensed legal professional in a particular case. | Affordable Law Firm Website Design by Law Promo |
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