KuCoin Crypto Exchange Charged by US for Anti-Money Laundering Violations

Federal prosecution has charged one of the largest crypto exchanges in the world, KuCoin, with violating U.S. anti-money laundering laws.

The crypto exchange has been indicted for not vetting customers and allowing billions of dollars of illicit money to be siphoned off since its existence in 2017.

The cryptocurrency exchange is indicted for not doing enough to verify their customers and their transactions.

KuCoin, which is a Seychelles-based exchange, was conducting business in the U.S. without registering with the Treasury Department and has also not put in place due procedures to verify clients’ identities as required by U.S. law.

KuCoin, on the other hand, said in a statement posted on its X handle that it is fully committed to following all the rules and regulations of the land and that the customer assets are safe and its lawyers are looking into the allegations.

Meanwhile, it is reported that the prosecutors have also charged the exchange’s founders, Chinese nationals Chun Gan, 34, and Ke Tang, 39, with conspiracy, but they are reportedly still at large.

In another separate civil lawsuit instituted by the U.S. Commodity Futures Trading Commission or the US CFTC, KuCoin has been charged for failing to register its futures and swap activities with the regulator.

In December, KuCoin gave its consent to block New York users from its platform and also agreed to pay $22 million as fines to settle the lawsuit instituted by the state for failing to register there.

KuCoin still lags behind Binance, Coinbase, and Kraken among cryptocurrency spot exchanges on different benchmarks such as traffic, liquidity, and trading volumes.

In another interesting development, the Commodity Futures Trading Commission (CFTC) has deemed both Ethereum (ETH) and Litecoin (LTC) as commodities in its recent lawsuit against KuCoin. KuCoin had made commodity transactions without registering with the CFTC, and the commission deems Bitcoin, Ethereum, and Litecoin as commodities that investors were able to trade.

The lawsuit stated,

“These actions brought KuCoin squarely within the CFTC’s authority and required KuCoin to register with the CFTC and comply with all applicable regulations. The commission is also seeking civil monetary penalties, permanent trading and registration bans, and a permanent injunction against further violations of the CEA and CFTC regulations, as charged.”

Manoj Nair

Manoj Nair: With a decade of news writing across various media platforms, Manoj is a seasoned professional. His dual role as an English teacher underscores his command over communication. He adeptly covers Politics, Technology, Crypto, and more, reflecting a broad and insightful perspective that engages and informs diverse audiences.

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