KuCoin Scandal Unveiled: A Deep Dive into Anti-Money Laundering Charges

Federal prosecutors in Manhattan have accused KuCoin, one of the globe’s largest crypto exchanges, of violating US anti-money laundering laws. KuCoin allegedly failed to adequately vet customers, resulting in the transfer of billions of dollars in illicit funds since its establishment in 2017.

According to prosecutors, the Seychelles-based exchange actively sought business from US clients without registering with the Treasury Department or implementing procedures to verify clients’ identities, as mandated by US law.

KuCoin released a statement on social media platform X asserting the safety of customer assets and mentioning that their legal team is investigating the allegations. “KuCoin respects the laws and regulations of various countries and strictly adheres to compliance standards,” the statement read.

The founders of the exchange, Chinese nationals Chun Gan, 34, and Ke Tang, 39, have also been charged with conspiracy. However, they remain at large, according to prosecutors.

Additionally, the US Commodity Futures Trading Commission filed a civil lawsuit against KuCoin, alleging the exchange’s failure to register its futures and swaps activities with the regulatory body.

In December, KuCoin agreed to block users from New York from its platform and pay a $22 million settlement to resolve the state’s lawsuit, which accused the exchange of failing to register in New York.

KuCoin ranks behind Binance, Coinbase, and Kraken among cryptocurrency spot exchanges in terms of factors such as traffic, liquidity, and trading volumes, as reported by data company CoinMarketCap.