New York
Crypto mogul Do Kwon, known as ‘the cryptocurrency king,’ pleads guilty to fraud charges
NEW YORK (AP) — South Korean cryptocurrency mogul Do Kwon pleaded guilty on Tuesday to two fraud charges arising from the $40 billion collapse of a cryptocurrency ecosystem that had promised investors their money was safe.
Kwon, 33, dubbed by some as “the cryptocurrency king,” entered the plea in Manhattan federal court.
According to a plea agreement signed by Kwon and prosecutors, the government said it will not seek a prison term of more than 12 years as long as Kwon complies with the deal’s terms, even though federal sentencing guidelines would have recommended a prison term of about 25 years. Sentencing is set for Dec. 11.
Authorities said investors worldwide lost money in the Singapore crypto firm Terraform Labs’ $40 billion cryptocurrency crash. Kwon co-founded the company in 2018.
The May 2022 collapse came after the company claimed that TerraUSD was a reliable “stablecoin.”
TerraUSD was designed as a “stablecoin,” a currency that is pegged to stable assets such as the dollar to prevent drastic fluctuations in prices. However, around $40 billion in market value was erased for the holders of TerraUSD and its floating sister currency, Luna, after the stablecoin plunged far below its $1 peg.
Kwon was extradited to the United States on Dec. 31 from Montenegro after his March 23, 2023, arrest while traveling on a false passport in Europe.
As part of his plea to one count of conspiring to commit commodities fraud, securities fraud and wire fraud and a second count of wire fraud, Kwon also agreed to forfeit over $19 million, an amount that authorities said reflected ill-gotten proceeds. He’ll also lose his interest in Terraform and its cryptocurrencies.
His lawyer, Sean Hecker, said the plea meant that Kwon had accepted responsibility for making false and misleading statements to investors.
In a statement, the lawyer said his client “takes responsibility for misleading the Terra community.”
In a news release, U.S. Attorney Jay Clayton said Kwon “used the technological promise and investment euphoria around cryptocurrency to commit one of the largest frauds in history.”
He said investors around the world suffered billions of dollars in losses.
New York
Ex-mayoral aide pleads guilty to soliciting straw donations for Adams campaign
NEW YORK (AP) — A former aide to New York City Mayor Eric Adams pleaded guilty Tuesday to soliciting straw donations in a case tied to separate corruption charges against Adams that the Trump administration ultimately decided to drop.
Mohamed Bahi, who served as City Hall’s chief liaison to the Muslim community, admitted in federal court that he helped solicit the illegal donations for Adams’ mayoral campaign from employees of a Brooklyn construction company at a December 2020 fundraiser.
“I understood that the Adams campaign would then seek matching funds for those donations,” Bahi told a judge, adding that he knew the employees would be reimbursed and “that it was wrong.”
Bahi, 41, was originally charged in October with witness tampering and destroying evidence as part of a sweeping federal investigation into Adams, culminating in the indictment of the mayor on charges of accepting bribes and campaign contributions from foreign interests in a separate fundraising scheme.
At the time, prosecutors said it was “likely” that others would be charged as part of “several related investigations.”
Then, in February, the Justice Department ordered federal prosecutors to drop the charges against Adams, arguing the case was interfering with the mayor’s ability to assist in President Donald Trump’s crackdown on illegal immigration.
The remarkable intervention prompted protests and resignations from several top prosecutors, including the interim U.S. attorney in Manhattan, who accused Adams of striking a quid pro quo with Trump.
Adams has adamantly denied any wrongdoing and pledged to continue his re-election campaign on an independent ballot line.
But even as the mayor no longer faces legal consequences, it has remained an open question how prosecutors will handle the web of investigations into his inner circle and campaign apparatus.
They have not provided any information about the status of other cases, including investigations that resulted in federal agents seizing phones last fall from the city’s police commissioner, multiple deputy mayors and other close advisers to Adams.
The owner of a separate construction company, Erden Arkan, pleaded guilty in January to funneling illegal campaign contributions to Adams. He is scheduled for sentencing later this week.
Bahi will be sentenced on Nov. 17 on a charge of conspiracy to commit wire fraud. He faces a maximum prison sentence of five years.
North Carolina
Judge tosses four convictions in 2002 killing of NBA star’s grandfather
WINSTON-SALEM, N.C. (AP) — A North Carolina trial judge has thrown out the convictions of four men in the 2002 death of basketball star Chris Paul’s grandfather. Now, state attorneys are considering their next moves, including an appeal.
Superior Court Judge Robert Broadie vacated and dismissed their convictions late last week following a January hearing in Forsyth County.
Nathaniel Arnold Cauthen, Rayshawn Denard Banner, Christopher Levon Bryant and Jermal Matthew Tolliver had been found guilty in trials in 2004 or 2005 for the killing of Nathaniel Jones. The four were all 14 or 15 years old when they and another teen were arrested.
Jones, 61, died from a heart attack outside his Winston-Salem home after being tied up, beaten and robbed.
A three-judge panel previously had denied the defendants’ innocence claims after testimony in a 2022 hearing.
But Broadie’s order, filed Friday, cited recanted testimony from a key witness, poor legal representation and questionable actions by police, the Winston-Salem Journal reported. DNA profiles also “further serve to corroborate Defendants’ assertions that their confessions were false” and that the defendants “were not present at the scene of the crime,” the judge wrote.
Paul, Jones’ grandson, was a standout high school basketball player at the time of the assault and had committed to play at Wake Forest University in Winston-Salem. Paul, now 40, is a 12-time NBA All-Star who now plays for the Los Angeles Clippers.
Attorney General Jeff Jackson’s office, whose lawyers defend criminal cases on appeal, asked the state Court of Appeals on Monday to halt enforcement of Broadie’s order “while we review it and consider next steps,” spokesperson Nazneen Ahmed said.
Cauthen and his brother, Banner, were convicted of first-degree murder and are serving life sentences. Bryant, Tolliver and Dorrell Brayboy were convicted of second-degree murder and were released after serving prison time. Brayboy was fatally stabbed outside a Winston-Salem supermarket in 2019.
Monday’s petition to the appeals court by a state attorney said that, without action, Cauthen and Banner “will be released back into the community without this Court having an opportunity to hear and determine the State’s issues on appeal.”
Forsyth County District Attorney Jim O’Neill criticized Broadie’s ruling, in particular his dismissals of the cases “with prejudice,” which could make them harder to appeal.
“I have never seen that happen before in a court of law,” O’Neill said in a statement to the newspaper. “Most judges welcome scrutiny and appellate review of their decisions.”
Christine Mumma, the lawyer for Banner and Cauthen, pushed back on criticism of the judge’s ruling.
“If the General Assembly didn’t want judges to have the authority to dismiss with prejudice, they wouldn’t have given judges that authority,” Mumma wrote in an email. “They also wouldn’t have passed statutes recognizing if charges are dismissed with prejudice, there’s no right of appeal.” Mumma is the executive director of the North Carolina Center on Actual Innocence, a nonprofit that helps investigate and litigate claims of innocence.
Minnesota
Prosecutor seeks to overturn man’s 1998 murder conviction after a witness confesses
A Minnesota prosecutor said Tuesday she will seek the release of a man imprisoned 27 years for murder after a key witness has recanted her testimony and told authorities she committed the crime.
Hennepin County Attorney Mary Moriarty said she supports the effort by attorneys for Bryan Hooper Sr. who are asking for a judge to vacate his conviction.
At a press conference, Moriarty apologized to Hooper’s adult daughter, Bri’ana Hooper, saying, “I understand at the same time, ‘sorry’ doesn’t bring back those 27 years. What we’re doing today, though, I hope is the beginning of getting your father out of prison.” Moriarty was not with the office in 1998.
Hooper now 54, was convicted by a jury at trial in 1998 of premeditated murder, felony murder while committing burglary and felony murder while committing kidnapping in connection with the death of Ann Prazniak, 77. He received three life sentences with the possibility of release after 30 years. He is in prison in Stillwater.
The woman who prosecutors say has confessed is in prison in Georgia for an assault-related crime and will be released in about four years.
Moriarty said attorneys will sort through the filing of charges against her after seeing which judge is assigned Hooper’s case and trying to get him released as quickly as possible. The woman expects to be charged with murder and “knows exactly what she’s getting into here,” Moriarty said.
Police found Prazniak’s body in April 1998 in a cardboard box wrapped with Christmas lights in a closet in her Minneapolis apartment — her ankles, nose, mouth, wrists and head bound and her body wrapped in garbage bags, blankets and bedding. Her cause of death was ruled asphyxiation, and she died two weeks to a month before police found her body, according to court documents.
Moriarty said her office’s Conviction Integrity Unit was reviewing Hooper’s case when officials learned the state’s star trial witness had come forward in late July on her own to recant her testimony against Hooper and to confess to killing Prazniak and concealing her body.
Bri’ana Hooper, who has advocated for her father’s release, lamented 27 years of missed birthdays, holidays, milestones and lost opportunities. “But today we don’t have to lose,” she said.
“We have an opportunity to shed light and use my father’s story to shed light on the other people who are sitting behind bars for crimes that they did not commit,” she said. Her father has maintained his innocence.
Attorneys for the Great North Innocence Project, representing Hooper, filed a petition to vacate his conviction. A judge would have 90 days to make a decision on that, Moriarty said.
Project Legal Director Jim Mayer said, “A strong criminal legal system is not one that insists on its own infallibility. A strong system is one that faces up to and confronts its failures, fixes its mistakes and works to repair the harm that’s been caused. We are taking a small step down that road today, but let’s acknowledge that we still have a long way to travel.”
Jailhouse informants who implicated Hooper also recanted their testimony long ago, Moriarty said.
In 2020, a judge granted Hooper’s request to vacate two of three first-degree murder charges after he argued he was wrongly convicted and sentenced for three counts of first-degree murder against the same person.
Crypto mogul Do Kwon, known as ‘the cryptocurrency king,’ pleads guilty to fraud charges
NEW YORK (AP) — South Korean cryptocurrency mogul Do Kwon pleaded guilty on Tuesday to two fraud charges arising from the $40 billion collapse of a cryptocurrency ecosystem that had promised investors their money was safe.
Kwon, 33, dubbed by some as “the cryptocurrency king,” entered the plea in Manhattan federal court.
According to a plea agreement signed by Kwon and prosecutors, the government said it will not seek a prison term of more than 12 years as long as Kwon complies with the deal’s terms, even though federal sentencing guidelines would have recommended a prison term of about 25 years. Sentencing is set for Dec. 11.
Authorities said investors worldwide lost money in the Singapore crypto firm Terraform Labs’ $40 billion cryptocurrency crash. Kwon co-founded the company in 2018.
The May 2022 collapse came after the company claimed that TerraUSD was a reliable “stablecoin.”
TerraUSD was designed as a “stablecoin,” a currency that is pegged to stable assets such as the dollar to prevent drastic fluctuations in prices. However, around $40 billion in market value was erased for the holders of TerraUSD and its floating sister currency, Luna, after the stablecoin plunged far below its $1 peg.
Kwon was extradited to the United States on Dec. 31 from Montenegro after his March 23, 2023, arrest while traveling on a false passport in Europe.
As part of his plea to one count of conspiring to commit commodities fraud, securities fraud and wire fraud and a second count of wire fraud, Kwon also agreed to forfeit over $19 million, an amount that authorities said reflected ill-gotten proceeds. He’ll also lose his interest in Terraform and its cryptocurrencies.
His lawyer, Sean Hecker, said the plea meant that Kwon had accepted responsibility for making false and misleading statements to investors.
In a statement, the lawyer said his client “takes responsibility for misleading the Terra community.”
In a news release, U.S. Attorney Jay Clayton said Kwon “used the technological promise and investment euphoria around cryptocurrency to commit one of the largest frauds in history.”
He said investors around the world suffered billions of dollars in losses.
New York
Ex-mayoral aide pleads guilty to soliciting straw donations for Adams campaign
NEW YORK (AP) — A former aide to New York City Mayor Eric Adams pleaded guilty Tuesday to soliciting straw donations in a case tied to separate corruption charges against Adams that the Trump administration ultimately decided to drop.
Mohamed Bahi, who served as City Hall’s chief liaison to the Muslim community, admitted in federal court that he helped solicit the illegal donations for Adams’ mayoral campaign from employees of a Brooklyn construction company at a December 2020 fundraiser.
“I understood that the Adams campaign would then seek matching funds for those donations,” Bahi told a judge, adding that he knew the employees would be reimbursed and “that it was wrong.”
Bahi, 41, was originally charged in October with witness tampering and destroying evidence as part of a sweeping federal investigation into Adams, culminating in the indictment of the mayor on charges of accepting bribes and campaign contributions from foreign interests in a separate fundraising scheme.
At the time, prosecutors said it was “likely” that others would be charged as part of “several related investigations.”
Then, in February, the Justice Department ordered federal prosecutors to drop the charges against Adams, arguing the case was interfering with the mayor’s ability to assist in President Donald Trump’s crackdown on illegal immigration.
The remarkable intervention prompted protests and resignations from several top prosecutors, including the interim U.S. attorney in Manhattan, who accused Adams of striking a quid pro quo with Trump.
Adams has adamantly denied any wrongdoing and pledged to continue his re-election campaign on an independent ballot line.
But even as the mayor no longer faces legal consequences, it has remained an open question how prosecutors will handle the web of investigations into his inner circle and campaign apparatus.
They have not provided any information about the status of other cases, including investigations that resulted in federal agents seizing phones last fall from the city’s police commissioner, multiple deputy mayors and other close advisers to Adams.
The owner of a separate construction company, Erden Arkan, pleaded guilty in January to funneling illegal campaign contributions to Adams. He is scheduled for sentencing later this week.
Bahi will be sentenced on Nov. 17 on a charge of conspiracy to commit wire fraud. He faces a maximum prison sentence of five years.
North Carolina
Judge tosses four convictions in 2002 killing of NBA star’s grandfather
WINSTON-SALEM, N.C. (AP) — A North Carolina trial judge has thrown out the convictions of four men in the 2002 death of basketball star Chris Paul’s grandfather. Now, state attorneys are considering their next moves, including an appeal.
Superior Court Judge Robert Broadie vacated and dismissed their convictions late last week following a January hearing in Forsyth County.
Nathaniel Arnold Cauthen, Rayshawn Denard Banner, Christopher Levon Bryant and Jermal Matthew Tolliver had been found guilty in trials in 2004 or 2005 for the killing of Nathaniel Jones. The four were all 14 or 15 years old when they and another teen were arrested.
Jones, 61, died from a heart attack outside his Winston-Salem home after being tied up, beaten and robbed.
A three-judge panel previously had denied the defendants’ innocence claims after testimony in a 2022 hearing.
But Broadie’s order, filed Friday, cited recanted testimony from a key witness, poor legal representation and questionable actions by police, the Winston-Salem Journal reported. DNA profiles also “further serve to corroborate Defendants’ assertions that their confessions were false” and that the defendants “were not present at the scene of the crime,” the judge wrote.
Paul, Jones’ grandson, was a standout high school basketball player at the time of the assault and had committed to play at Wake Forest University in Winston-Salem. Paul, now 40, is a 12-time NBA All-Star who now plays for the Los Angeles Clippers.
Attorney General Jeff Jackson’s office, whose lawyers defend criminal cases on appeal, asked the state Court of Appeals on Monday to halt enforcement of Broadie’s order “while we review it and consider next steps,” spokesperson Nazneen Ahmed said.
Cauthen and his brother, Banner, were convicted of first-degree murder and are serving life sentences. Bryant, Tolliver and Dorrell Brayboy were convicted of second-degree murder and were released after serving prison time. Brayboy was fatally stabbed outside a Winston-Salem supermarket in 2019.
Monday’s petition to the appeals court by a state attorney said that, without action, Cauthen and Banner “will be released back into the community without this Court having an opportunity to hear and determine the State’s issues on appeal.”
Forsyth County District Attorney Jim O’Neill criticized Broadie’s ruling, in particular his dismissals of the cases “with prejudice,” which could make them harder to appeal.
“I have never seen that happen before in a court of law,” O’Neill said in a statement to the newspaper. “Most judges welcome scrutiny and appellate review of their decisions.”
Christine Mumma, the lawyer for Banner and Cauthen, pushed back on criticism of the judge’s ruling.
“If the General Assembly didn’t want judges to have the authority to dismiss with prejudice, they wouldn’t have given judges that authority,” Mumma wrote in an email. “They also wouldn’t have passed statutes recognizing if charges are dismissed with prejudice, there’s no right of appeal.” Mumma is the executive director of the North Carolina Center on Actual Innocence, a nonprofit that helps investigate and litigate claims of innocence.
Minnesota
Prosecutor seeks to overturn man’s 1998 murder conviction after a witness confesses
A Minnesota prosecutor said Tuesday she will seek the release of a man imprisoned 27 years for murder after a key witness has recanted her testimony and told authorities she committed the crime.
Hennepin County Attorney Mary Moriarty said she supports the effort by attorneys for Bryan Hooper Sr. who are asking for a judge to vacate his conviction.
At a press conference, Moriarty apologized to Hooper’s adult daughter, Bri’ana Hooper, saying, “I understand at the same time, ‘sorry’ doesn’t bring back those 27 years. What we’re doing today, though, I hope is the beginning of getting your father out of prison.” Moriarty was not with the office in 1998.
Hooper now 54, was convicted by a jury at trial in 1998 of premeditated murder, felony murder while committing burglary and felony murder while committing kidnapping in connection with the death of Ann Prazniak, 77. He received three life sentences with the possibility of release after 30 years. He is in prison in Stillwater.
The woman who prosecutors say has confessed is in prison in Georgia for an assault-related crime and will be released in about four years.
Moriarty said attorneys will sort through the filing of charges against her after seeing which judge is assigned Hooper’s case and trying to get him released as quickly as possible. The woman expects to be charged with murder and “knows exactly what she’s getting into here,” Moriarty said.
Police found Prazniak’s body in April 1998 in a cardboard box wrapped with Christmas lights in a closet in her Minneapolis apartment — her ankles, nose, mouth, wrists and head bound and her body wrapped in garbage bags, blankets and bedding. Her cause of death was ruled asphyxiation, and she died two weeks to a month before police found her body, according to court documents.
Moriarty said her office’s Conviction Integrity Unit was reviewing Hooper’s case when officials learned the state’s star trial witness had come forward in late July on her own to recant her testimony against Hooper and to confess to killing Prazniak and concealing her body.
Bri’ana Hooper, who has advocated for her father’s release, lamented 27 years of missed birthdays, holidays, milestones and lost opportunities. “But today we don’t have to lose,” she said.
“We have an opportunity to shed light and use my father’s story to shed light on the other people who are sitting behind bars for crimes that they did not commit,” she said. Her father has maintained his innocence.
Attorneys for the Great North Innocence Project, representing Hooper, filed a petition to vacate his conviction. A judge would have 90 days to make a decision on that, Moriarty said.
Project Legal Director Jim Mayer said, “A strong criminal legal system is not one that insists on its own infallibility. A strong system is one that faces up to and confronts its failures, fixes its mistakes and works to repair the harm that’s been caused. We are taking a small step down that road today, but let’s acknowledge that we still have a long way to travel.”
Jailhouse informants who implicated Hooper also recanted their testimony long ago, Moriarty said.
In 2020, a judge granted Hooper’s request to vacate two of three first-degree murder charges after he argued he was wrongly convicted and sentenced for three counts of first-degree murder against the same person.
