The United States Justice Department has revealed an indictment against cryptocurrency exchange KuCoin and two of its founders for participating in an unlicensed money transmitting business and violating the Bank Secrecy Act. The announcement was made on March 26 by the U.S. Department of Justice. The founders, Chun Gan and Ke Tang, were accused of intentionally neglecting to establish an Anti-Money Laundering program at the exchange, resulting in the platform being used for money laundering and terrorist financing. Additionally, the company itself was charged with operating an unlicensed money-transmitting business and violating the BSA.
According to U.S. Attorney Damian Williams, KuCoin and its founders deliberately concealed the fact that a significant number of U.S. users were trading on the platform. Williams stated 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.
The U.S. Commodity Futures Trading Commission (CFTC) also filed a civil enforcement case against KuCoin on the same day, charging the exchange with multiple violations of the Commodity Exchange Act (CEA) and CFTC regulations. The Justice Department revealed that KuCoin received over $5 billion and transferred more than $4 billion of suspicious and criminal funds.
The founders of KuCoin, Chun Gan and Ke Tang, played a role in the launch of the exchange in 2017. KuCoin’s operational headquarters were located in Seychelles, according to its website. At the time of publication, the two founders, who are Chinese nationals, were still at large.
U.S. authorities have been actively pursuing criminal charges against cryptocurrency exchanges and their executives operating within 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.