The United States Justice Department has unveiled an indictment against cryptocurrency exchange KuCoin and its two founders for engaging in an unlicensed money transmitting business and violating the Bank Secrecy Act. The Department of Justice stated that Chun Gan and Ke Tang, the founders of KuCoin, intentionally neglected to establish an Anti-Money Laundering program at the exchange, resulting in the platform being utilized for money laundering and terrorist financing. Additionally, the company itself was charged with operating an unlicensed money-transmitting business and violating the BSA.
U.S. Attorney Damian Williams stated that KuCoin and its founders purposely concealed the fact that a significant number of U.S. users were trading on the platform. He further mentioned that KuCoin exploited its substantial U.S. customer base to become one of the world’s largest cryptocurrency derivatives and spot exchanges, facilitating billions of dollars in daily trades and trillions of dollars in annual trade volume.
Simultaneously, the U.S. Commodity Futures Trading Commission (CFTC) filed a civil enforcement case against KuCoin on March 26, accusing the exchange of multiple violations of the Commodity Exchange Act (CEA) and CFTC regulations. According to the Justice Department, KuCoin received over $5 billion and transferred more than $4 billion of suspicious and criminal funds.
Chun Gan and Ke Tang were instrumental in launching KuCoin in 2017. The exchange’s operational headquarters were located in Seychelles, as stated on its website. At the time of publication, the two Chinese founders were still at large.
U.S. authorities have been actively pursuing criminal charges against cryptocurrency exchanges and their executives operating within the country. On March 28, former FTX CEO Sam Bankman-Fried is scheduled to be sentenced after being convicted on seven felony charges. Former Binance CEO Changpeng Zhao is expected to receive his sentence on April 30.
The intensification of efforts by U.S. enforcement agencies against crypto-related crimes is becoming increasingly apparent.