The United States Justice Department has revealed an indictment against cryptocurrency exchange KuCoin and its two founders for conspiring to operate an unlicensed money transmitting business and violating the Bank Secrecy Act (BSA).
According to the U.S. Department of Justice, KuCoin founders Chun Gan and Ke Tang intentionally neglected to maintain an Anti-Money Laundering program at the exchange, resulting in the platform being utilized for money laundering and terrorist financing. The company itself is accused of operating an unlicensed money-transmitting business and breaching the BSA.
U.S. Attorney Damian Williams stated that KuCoin and its founders deliberately concealed the fact that a significant number of U.S. users were trading on the platform. He further noted that KuCoin took advantage of its substantial 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 Department of Justice’s criminal charges coincide with a civil enforcement case filed by the U.S. Commodity Futures Trading Commission (CFTC) against KuCoin on March 26. The CFTC has charged KuCoin with multiple violations of the Commodity Exchange Act (CEA) and CFTC regulations. The Justice Department claims that KuCoin received over $5 billion and transferred more than $4 billion of suspicious and criminal funds.
Chun Gan and Ke Tang played key roles in the establishment of KuCoin in 2017. KuCoin’s operational headquarters were based in Seychelles, according to 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 operating within the country. On March 28, former FTX CEO Sam Bankman-Fried is set to be sentenced after being convicted on seven felony charges. Former Binance CEO Changpeng Zhao is expected to face sentencing on April 30.
US enforcement agencies are intensifying their efforts to combat crypto-related crimes.