KuCoin has admitted to violating U.S. anti-money laundering and KYC regulations, pleading guilty to running an unlicensed money-transmitting business.
The company has been fined $297 million and must suspend its U.S. operations for at least two years.
In an official statement from the U.S. Attorney’s Office for the Southern District of New York, U.S. Attorney Danielle Sassoon criticized KuCoin for not implementing essential anti-money laundering (AML) policies. Sassoon stated that the company facilitated billions of dollars in suspicious transactions, including funds associated with darknet markets, ransomware, fraud schemes, and other illegal activities.
“Today’s guilty plea and penalties show the cost of refusing to follow these laws and allowing unlawful activity to continue,”
she said.
The case stems from allegations that KuCoin processed over $5 billion in funds that the U.S. government considers suspicious and transmitted more than $4 billion in criminal proceeds. Until July 2024, the exchange did not require Know Your Customer (KYC) verification from its users, which violated U.S. regulatory standards. Additionally, KuCoin failed to register with the Financial Crimes Enforcement Network (FinCEN), a mandatory requirement for cryptocurrency businesses operating in the United States.
As part of the plea agreement, KuCoin’s founders, Chun Gan (known as Michael) and Ke Tang, have stepped down from their leadership roles. Chun Gan announced his resignation as CEO in a blog post, explaining that the decision aligns with the settlement terms.
Gan also confirmed the appointment of BC Wong as his successor to lead the exchange. In a post on X, BC Wong expressed gratitude for Chun Gan’s contributions to KuCoin and the crypto industry: “I am deeply grateful for @crypto_michaelg Michael’s trust and the strong foundation he’s built for KuCoin. His vision and leadership have shaped both our company and the broader crypto industry. Wishing him the very best in his exciting future plans. The KuCoin spirit he created will always guide us!”
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