- Investigators alleged that KuCoin openly disregarded anti-money laundering laws in the US.
- The company is one of the top 10 cryptocurrency exchanges in the world by trading volume.
KuCoin in Trouble with US Authorities
A giant cryptocurrency exchange gets in trouble with the US authorities once more. Today, the US Attorney’s Office of the Southern District of New York announced the formal charging of KuCoin and its two founders for skirting money transmission regulations and the provisions of the Bank Secrecy Act.
Named in the complaint filed in court by US Attorney Damian Williams and Homeland Security Investigations New York Field Office Head Darren McCormack were the people responsible for putting up the exchange, Chun Gan and Ke Tang. The investigators alleged that the two “conspired to operate an unlicensed money-transmitting business.”
Likewise, the mentioned individuals deliberately disregarded the nation’s Bank Secrecy Act when they failed to establish adequate measures to prevent illicit activities from occurring within the platform like money laundering and terrorist financing according to the authorities. The allegations included failure to place identity verification features as well as failure to monitor and report any suspicious activities.
The filing claimed KuCoin has been servicing US customers since the launch of its spot and futures trading features in July 2019. No KYC (Know Your Customer) procedures existed in the platform until at least July 2023 when its management found that it was under probe by US officials said Williams.
Despite the recent developments in the case, both Gan and Tang remain at large.
About the Company
KuCoin caters to more than 30 million customers in over 200 countries and processes billions of dollars in trading volume daily. It’s not yet known how many of its users are in the US or have been in the country when it came under the radar of federal regulators.
As of this writing at 5:20 PM UTC, the 24-hour transaction volume of the exchange sits at $2.25 billion and it is estimated to possess $6.31 billion in assets based on CoinMarketCap data. Around 55% of its reserves were in Tether (USDT), Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and KuCoin (KCS).
The company prides itself with its moniker the “People’s Exchange” for its intuitive design, high-level security, and simple registration process. The latter seems to be where it got in trouble with US watchdogs. The exchange is led by its CEO Johnny Lyu, who was not named in the lawsuit.