Cryptocurrency exchange KuCoin charged with anti-money laundering violations in the US
US federal prosecutors have charged cryptocurrency exchange KuCoin and two of its founders with violating anti-money laundering laws. The charges allege that KuCoin operated in the US while misleading investors about its operations
Federal prosecutors in the US have charged cryptocurrency exchange KuCoin and two of its founders, Chun Gan and Ke Tang, with violating anti-money laundering laws. The charges allege that the exchange operated in the US while misleading investors about its operations and failed to register with US government or maintain an anti-money laundering program.
The charges claim that cryptocurrency exchange KuCoin, with over 30 million customers, did not implement a know-your-customer (KYC) or anti-money laundering (AML) program until 2023. Even when the KYC program was introduced, it did not apply to existing customers. KuCoin’s lack of these programs allowed it to be used for money laundering, including proceeds from sanctions violations, darknet markets, and fraud schemes.
Specifically, the indictment alleges that KuCoin indirectly received over $3.2 million worth of cryptocurrency from Tornado Cash, a sanctioned crypto mixer. The charges are linked to criminal filings against two developers associated with Tornado Cash.
United States Commodity Futures Trading Commission (CFTC) has also filed a suit against KuCoin, claiming the exchange did not register as a futures commission merchant. It also failed to implement the CFTC’s equivalent of a KYC program.
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