KuCoin Indicted for Alleged Multi-Billion Dollar Criminal Conspiracy
Global crypto exchange KuCoin and two of its founders, Chun Gan and Ke Tang, have been indicted by U.S. authorities for allegedly conspiring to operate an unlicensed money transmitting business and violating the Bank Secrecy Act.
The indictment accuses KuCoin of failing to maintain adequate anti-money laundering (AML) programs and knowingly serving U.S. customers without proper licenses.
Key highlights:
- KuCoin and its founders are accused of conspiring to operate an unlicensed money transmitting business.
- The exchange allegedly failed to implement proper AML and know-your-customer (KYC) programs.
- KuCoin faces accusations of receiving and sending over $5 billion in suspicious and criminal funds.
- The exchange allegedly concealed the fact that it had a substantial U.S. customer base to avoid compliance with U.S. laws.
- Gan and Tang, both Chinese citizens, remain at large and face a maximum sentence of five years in prison for each charge.
According to U.S. Attorney Damian Williams, KuCoin and its founders deliberately sought to conceal the fact that a significant number of U.S. users were trading on the platform.
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Williams emphasized that financial institutions like KuCoin must comply with U.S. laws to help identify and combat crime and corrupt financing schemes. He also stated that the indictment should send a clear message to other crypto exchanges: “If you plan to serve U.S. customers, you must follow U.S. law, plain and simple.”
KuCoin allegedly failed to implement adequate KYC processes
HSI Acting Special Agent described the investigation’s findings as exposing KuCoin as an alleged multi-billion dollar criminal conspiracy.
The indictment alleges that KuCoin, which has grown to service over 30 million customers, failed to implement adequate KYC processes until July 2023.
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Furthermore, allegations against KuCoin and its founders include actively preventing U.S. customers from identifying themselves as such when opening accounts and lying to an investor in 2022 about having no U.S. customers.
Large sums of criminal proceeds, including those from darknet markets, malware, ransomware, and fraud schemes, have also allegedly passed through the exchange. Since its founding in 2017, the exchange has allegedly received over $5 billion and sent over $4 billion in suspicious and criminal funds.
