SEC Objects to Terraform’s $166M Retainer of Law Firm Dentons: Reuters
The U.S. Securities and Exchange Commission (SEC) has objected to a $166 million retainer payment to Terraform's lawyers. The SEC also stated that Terraform should not be allowed to hire law firm Dentons or pay its employees' litigation costs. The SEC alleges that Terraform sent $166 million to Dentons to avoid paying a future judgment in the SEC's lawsuit. Terraform Labs and its founder, Do Kwon, are facing a trial in the U.S. over the collapse of TerraUSD. After the stablecoin and the LUNA token collapsed in May 2022, destroying billions in investor wealth, Terraform Labs filed for Chapter 11 bankruptcy in January 2024. The SEC claims the money was siphoned off into a slush fund for its lawyers, which could have been used to repay investors and creditors in Terraform's bankruptcy. Neither Terraform Labs nor Dentons have commented on the matter.
