The US Department of Justice (DOJ) and the Commodities Futures Trading Commission (CFTC) have announced the unveiling of charges against crypto exchange KuCoin and two of its founders.
In a statement from the U.S. Attorney’s Office in the Southern District of New York, U.S. Attorney Damian Williams and Darren McCormack, the Acting Special Agent in Charge of the New York Field Office of Homeland Security Investigations (“HSI”), said Kucoin , Together with founder Chun Gan and Ke Tang, they conspired to commit various violations of the Bank Secrecy Act.
The government says the duo established an “unlicensed money transmitting business” and failed to maintain an adequate anti-money laundering (“AML”) program, failed to properly verify the identities of their customers and failed to file suspicious activity reports.
Attorney Williams says the exchange and its founders “deliberately attempted to conceal the fact that significant numbers of U.S. users were trading on the KuCoin platform.”
“Indeed, KuCoin is said to have capitalized on its sizable US customer base to become one of the world’s largest cryptocurrency derivatives and spot exchanges, with billions of dollars in daily transactions and trillions of dollars in annual trading volume.
But financial institutions like KuCoin that take advantage of the unique opportunities available in the United States must also comply with U.S. laws to help identify and root out crime and corrupt financing schemes. KuCoin reportedly consciously chose not to do this.”
Williams also claims that KuCoin received more than $5 billion and sent more than $4 billion in “suspicious and criminal funds.”
Darren McCormack described KuCoin as an “alleged multi-billion dollar criminal conspiracy.”
Gan and Tang are each charged with one count of conspiracy to violate the Bank Secrecy Act and one count of conspiracy to operate an unlicensed money transmission business, each of which carries a maximum penalty of five years in prison.
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