The United States Justice Department has unveiled an indictment against cryptocurrency exchange KuCoin and its two founders for conspiring to operate an unlicensed money transmitting business and violating the Bank Secrecy Act. The indictment alleges that KuCoin founders Chun Gan and Ke Tang intentionally failed to establish an Anti-Money Laundering program at the exchange, resulting in the platform being used for money laundering and terrorist financing. The company itself is accused of operating an unlicensed money-transmitting business and violating the BSA.
U.S. Attorney Damian Williams stated that KuCoin and its founders deliberately concealed the fact that a significant number of U.S. users were trading on the platform. He highlighted that KuCoin took advantage of its large U.S. customer base to become one of the world’s largest cryptocurrency derivatives and spot exchanges, with billions of dollars in daily trades and trillions of dollars in annual trade volume.
Alongside the criminal charges, the U.S. Commodity Futures Trading Commission (CFTC) also filed a civil enforcement case against KuCoin for multiple violations of the Commodity Exchange Act and CFTC regulations. The Department of Justice claims that KuCoin received over $5 billion and sent more than $4 billion of suspicious and criminal funds.
Chun Gan and Ke Tang, both Chinese nationals, were instrumental in the launch of KuCoin in 2017. At the time of publication, they remain at large.
This is not the first time U.S. officials have pursued criminal charges against cryptocurrency exchanges and their executives operating in the country. Former FTX CEO Sam Bankman-Fried is scheduled to be sentenced on March 28 after being convicted on seven felony charges. Former Binance CEO Changpeng Zhao is expected to be sentenced on April 30.
The enforcement agencies in the United States are intensifying their efforts to combat crypto-related crimes.