The United States Justice Department has made public an indictment against KuCoin, a cryptocurrency exchange, and its two founders for engaging in an unlicensed money transmitting business and violating the Bank Secrecy Act. The Department of Justice stated that KuCoin founders Chun Gan and Ke Tang intentionally neglected to implement an Anti-Money Laundering program, resulting in the exchange being used for money laundering and terrorist financing. Additionally, the company was charged with running an unlicensed money-transmitting business and breaching 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 also noted that KuCoin capitalized on its substantial U.S. customer base to become one of the largest cryptocurrency derivatives and spot exchanges globally, with billions of dollars in daily trades and trillions of dollars in annual trade volume.
Alongside the Department of Justice criminal charges, the U.S. Commodity Futures Trading Commission (CFTC) filed a civil enforcement case against KuCoin on March 26. The CFTC accused KuCoin of multiple violations of the Commodity Exchange Act (CEA) and CFTC regulations. The Justice Department revealed that KuCoin received over $5 billion and sent over $4 billion of suspicious and criminal funds.
Chun Gan and Ke Tang played a role in launching KuCoin in 2017, with the exchange’s operational headquarters based in Seychelles, as stated on its website. At the time of publication, the two Chinese founders remained at large.
U.S. authorities have been actively pursuing criminal charges against cryptocurrency exchanges and their executives conducting business in the country. Former FTX CEO Sam Bankman-Fried is scheduled to be sentenced on March 28 after being convicted on seven felony charges, while 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.