US Department of Justice Accuses KuCoin and Founder of Disregarding Anti-Money Laundering Laws, CFTC Initiates Civil Lawsuit

According to a report by The Block, the US Department of Justice announced on Tuesday (26th) that it has filed charges against cryptocurrency exchange KuCoin and its two founders, alleging that they violated anti-money laundering laws.

According to the indictment released by the US Southern District of New York’s prosecutor’s office, KuCoin and its founders Chun Gan and Ke Tang have been accused of operating an unlicensed money transfer business and violating the Bank Secrecy Act. US prosecutors claim that the exchange failed to maintain proper anti-money laundering programs, failed to establish “reasonable procedures” to verify customer identities, and failed to submit suspicious activity reports.

The indictment points out that KuCoin deliberately evaded US anti-money laundering and Know Your Customer (KYC) regulations by falsely claiming that it did not have US customers, but in reality, KuCoin has a large number of US customers. Authorities claim that KuCoin allowed its platform to be used to launder over $9 billion.

The Department of Justice also stated that the US Commodity Futures Trading Commission (CFTC) filed a parallel civil lawsuit against KuCoin on Tuesday. According to the announcement, KuCoin is accused by the CFTC of operating an illegal digital asset derivatives exchange.

After the news of the indictment was released, KuCoin stated on its platform X that it is operating well and user assets are secure. It is currently investigating the details through lawyers and stated that KuCoin respects the laws and regulations of all countries and adheres strictly to compliance standards.