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U.S. Prosecutors accuse KuCoin and founders of money laundering

KuCoin, a prominent cryptocurrency exchange, and its founders Chun Gan and Ke Tang are facing charges from U.S. federal prosecutors for allegedly violating anti-money laundering (AML) laws.

According to the indictment, KuCoin is accused of operating as a money transmitting business in the U.S. without proper registration or implementation of AML measures. Prosecutors claim that KuCoin’s actions facilitated the laundering of proceeds from various illicit activities, including sanctions violations and fraud schemes.

Despite its large user base, KuCoin reportedly did not adopt adequate AML and know-your-customer (KYC) protocols until 2023, leaving it vulnerable to exploitation by criminals.

This legal action highlights the increasing regulatory scrutiny faced by cryptocurrency platforms globally, as authorities aim to address the sector’s susceptibility to financial crime.

In addition to the criminal charges, the Commodity Futures Trading Commission (CFTC) filed a separate lawsuit against KuCoin, alleging failure to register as a futures commission merchant and non-compliance with KYC regulations.

Darren McCormack, Special Agent in Charge at Homeland Security Investigations, described KuCoin as “an alleged multibillion-dollar criminal conspiracy,” emphasizing its significant role in the crypto market.

Meanwhile, U.S. Attorney Damien Williams criticized KuCoin’s purported efforts to conceal its U.S. user base and its use as a hub for money laundering.

As legal proceedings continue, KuCoin’s native token (KCS) experienced a 12% decline, reflecting investor concerns. However, Bitcoin (BTC) remained volatile, trading around $70,000 amid market turbulence.

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