Do Kwon’s new home: an overcrowded Balkan prison with mafia suspects and little hope

• Former Terra chief and crypto fugitive are being held in isolation pending extradition proceedings.
• Kwon and his associate Han Chang-Joon are ‘well, stable’ says Kwon’s lawyer.
• Spuz Prison in Montenegro houses numerous gangsters awaiting trial.

Do Kwon breathes fresh air twice a day. His new home is occupied by organised crime members awaiting trial. And he is alone.

Kwon, the disgraced co-founder and CEO of Terraform Labs and onetime fugitive, is being held in isolation from other inmates in the pre-trial detention wing of a dilapidated prison in Montenegro, according to Goran Rodic, Kwon’s local lawyer.

Chances are it will be Kwon’s home for the foreseeable future after being convicted on June 19 of trying to use a forged Costa Rican passport to leave the tiny Balkan nation on a private jet earlier this year.

Prison yard

In 2022, Kwon was bestride the crypto world — a lauded entrepreneur who oversaw a blockchain ecosystem worth $60 billion.

Now guards open his cell twice a day to let him stretch his legs under in the yard at Spuz Prison, an overcrowded facility located a dozen kilometres northwest of Montenegro’s capital Podgorica.

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After he was found guilty of using the bogus passport, a Montenegro judge sentenced Kwon to a four month term. Yet he and his associate, Han Chang-Joon, who was arrested at the same time trying to leave Montenegro, had virtually no chance of being released.

‘They are well, stable. The conditions are bad. It’s not like in the movies. Prison is not easy for anyone.’

—  Goran Rodic

That’s because Kwon is wanted by prosecutors in his native South Korea and the US on fraud charges stemming from the Terra’s meltdown in May 2022. (Han is also wanted by South Korean authorities). Aided by a stash of Bitcoin in a Swiss bank, Kwon eluded an Interpol red notice for more than six months by hiding in Serbia and Montenegro.

As Montenegro’s judicial officials weigh their extraditions both men will remain incarcerated for at least six months.

Despite the grim outlook, Kwon’s lawyer said his clients are holding up. “They are well, stable,” Rodic told DL News. “The conditions are bad. It’s not like in the movies. Prison is not easy for anyone.”

Kwon may be thankful for his solo cell. The prison is home to several members of the feuding mafia clans that thrive in the Balkans, according to Aleksandra Dubak, a legal adviser who monitors the jail for local human rights NGO Civic Alliance.

Gang violence

Some who are awaiting trial are lieutenants of rival gangs, who are accused of murder, planting bombs, extortion, and running an international drug smuggling ring. Gang violence is so bad behind bars, authorities have ramped up surveillance to make sure the warring members don’t cross paths, according to local media reports.

Prison officials try to prevent violence by carefully placing members of rival gangs in parts of the prison to minimise contact, according to Dubak. At the beginning of this year, there were 380 prisoners in a pre-trial detention facility with capacity for 292, according to Vijesti, a local media outlet.

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“The overcrowding has been like that for years,” Dubak told DL News. “If a prisoner is alone in their cell it is for a special reason — perhaps for health, risk of violence or there’s a special request.”

As for what comes next, Rodic said it is premature to talk about appealing the forgery conviction and he is poised to begin reviewing the extradition cases.

“We still haven’t received the documentation for extradition either,” he told DL News on Tuesday morning.

Extradition request

In a press conference addressing the two nations’ competing claims for extradition on March 29, Minister of Justice Marko Kovac said all factors would be considered by a local judge.

“The gravity of the criminal offence, the place where the criminal offence was committed, the order in which the extradition request was received, as well as the citizenship of the person and other circumstances will be taken into account,” he said.

Have tips about crypto enforcement matters? Contact the authors at isabel@dlnews.com and ana@dlnews.com.