KuCoin and Founders Indicted for Violating U.S. Anti-Money Laundering Laws

A recent indictment unsealed by the United States Attorney for the Southern District of New York has accused global cryptocurrency exchange KuCoin and two of its founders, Chun Gan and Ke Tang, of conspiring to operate without the required licenses for money transmitting and failing to establish an adequate anti-money laundering (AML) program.

The charges against KuCoin and its founders include willfully neglecting to verify customer identities or report suspicious activities, as mandated by the Bank Secrecy Act (BSA).

According to the U.S. Attorney’s Office, KuCoin had actively concealed its substantial engagement with U.S. traders, allowing it to amass over 30 million customers and billions in daily trades by not adhering to U.S. regulatory requirements.

The indictment alleges that KuCoin facilitated the laundering of over $5 billion in suspicious funds, with $4 billion in withdrawals, since its inception in 2017.

The U.S. Attorney emphasized that KuCoin, Chun Gan, and Ke Tang deliberately avoided complying with U.S. regulations, despite being aware of their obligations under the BSA.

KuCoin attempted to disguise its significant U.S. customer base to evade AML and KYC protocols and actively marketed itself as an exchange allowing users to avoid identity verification.

Chun Gan and Ke Tang, both Chinese citizens, face charges of conspiring to violate the Bank Secrecy Act and operating an unlicensed money transmitting business, among others.

Entities operating as KuCoin, including FLASHDOT LIMITED, PEKEN GLOBAL LIMITED, and PHOENIXFIN PRIVATE LIMITED, collectively d/b/a «KuCoin,» are also charged with various violations under the BSA.

The investigation was lauded by the U.S. Attorney and Homeland Security Investigations for uncovering the alleged criminal conduct of one of the largest global cryptocurrency exchanges.