As the Terra investigation intensifies, the Office of the New York Attorney General has strongly encouraged New Yorkers affected by the collapse of the Terra (LUNA) ecosystem tokens and other crypto-related frauds to file complaints.
The Attorney General also urged witnesses of corruption in the cryptocurrency industry to anonymously file whistleblower complaints with her office.
Per an announcement, Attorney General Letitia James stimulated workers in the crypto industry who may have witnessed misconduct to file a whistleblower complaint. For safety purposes, this can be done without revealing one’s identity.
This notice to New Yorkers comes as part of the Office of the Attorney General’s investigative work into the recent happenings in the space that has left many investors in huge financial losses.
As highlighted in the update, many prominent cryptocurrency companies have frozen customer withdrawals. There have been several instances of layoffs by crypto companies while some blockchain businesses have been hit with insolvency or low liquidity problems, thereby filing for different kinds of bankruptcy in courts.
Legal Problems Pile Up for Do Kwon and TerraForm Labs
Recall that in May, Do Kwon’s Terra ecosystem tokens including UST and Luna collapsed massively and are yet to recover. Many holders of these Terra tokens experienced a high level of losses.
While numerous investigations into the case by Korean and United States authorities are ongoing, renowned lawyers and law firms have filed class action lawsuits against Do Kwon, TerraForm Labs, and other players linked to the unusual crash.
Last month, more than five Korea-based exchanges and homes of TerraForm labs officials were raided by the Korean prosecutors.
Top venture capital, Three Arrows Capital (3AC), also filed for Chapter 15 bankruptcy in a bid to prevent the confiscation of its assets in the United States after it was served a liquidation order
Among the impacts of the Terra ecosystem’s collapse is the liquidity problem faced by Celsius. Lending platform Celsius halted users from carrying out operations like withdrawals and transfers of assets.
Attorney General Letitia James, who is interested in hearing how these occurrences have affected New York investors said in a press release:
“The recent turbulence and significant losses in the cryptocurrency market are concerning. Investors were promised large returns on cryptocurrencies but instead lost their hard-earned money. I urge any New Yorker who believes they were deceived by crypto platforms to contact my office, and I encourage workers in crypto companies who may have witnessed misconduct to file a whistleblower complaint.
“New Yorkers who have been affected by the dramatic devaluations of the Terra and Luna virtual currencies and the account freezes on cryptocurrency staking or earning programs, such as Anchor, Celsius, Voyager, and Stablegains, are strongly encouraged to contact the Office of the Attorney General’s Investor Protection Bureau.”