The United States Justice Department has unveiled a legal indictment against cryptocurrency exchange KuCoin and its two founders for their involvement in an unlicensed money transmitting business and violations of the Bank Secrecy Act. The indictment was made public on March 26 by the U.S. Department of Justice, which accused KuCoin founders Chun Gan and Ke Tang of intentionally neglecting to establish an Anti-Money Laundering program for the exchange. Consequently, the platform was exploited for money laundering and terrorist financing. Furthermore, the company itself was charged for operating a money-transmitting business without a license and for breaching the BSA regulations.
U.S. Attorney Damian Williams stated that KuCoin and its founders purposely concealed the fact that a substantial number of U.S. users were trading on their platform. Williams went on to assert that KuCoin capitalized on its considerable U.S. customer base and emerged as one of the world’s largest cryptocurrency derivatives and spot exchanges, conducting billions of dollars in daily trades and trillions of dollars in annual trade volume.
On the same day, the U.S. Commodity Futures Trading Commission (CFTC) also filed a civil enforcement case against KuCoin, charging the exchange with numerous violations of the Commodity Exchange Act and CFTC regulations. The Justice Department revealed that KuCoin had received over $5 billion and transferred over $4 billion in suspicious and criminal funds.
Chun Gan and Ke Tang played a pivotal role in the establishment of KuCoin in 2017. The exchange’s operational headquarters were located in Seychelles, as stated on its website. Both founders, who are Chinese nationals, are currently at large.
U.S. authorities have been actively pursuing criminal charges against cryptocurrency exchanges and their executives operating within the country. Sam Bankman-Fried, former CEO of FTX, is slated to be sentenced on March 28 after being convicted on seven felony charges. Additionally, Changpeng Zhao, former CEO of Binance, is expected to face sentencing on April 30.
The United States enforcement agencies are intensifying their efforts to combat crypto-related crimes.