KuCoin Founders Indicted for Money Laundering, Bank Secrecy Act Violations

On March 26, 2024, the U.S. government indicted cryptocurrency exchange KuCoin and its founders, Chun Gan and Ke Tang, for failing to implement anti-money laundering measures, enabling over $5 billion in criminal funds to move through its platform. The indictment alleges a "multibillion-dollar criminal conspiracy," with Gan and Tang facing penalties for violating the Bank Secrecy Act and money transmission laws.

U.S. Justice Department Indicts KuCoin Founders for Money Laundering and Bank Secrecy Act Violations

New York, N.Y. – The United States government has indicted KuCoin, a global cryptocurrency exchange, and its two founders, Chun Gan and Ke Tang, on criminal charges related to money laundering and violations of the Bank Secrecy Act.

The indictment, unsealed Tuesday in the Southern District of New York, alleges that KuCoin "willfully failed to implement and maintain effective anti-money laundering protocols," allowing "billions of dollars in criminal proceeds to flow through its trading platform."

The charges stem from a multibillion-dollar criminal conspiracy that enabled KuCoin to grow into one of the world's largest cryptocurrency exchanges, according to a press release issued by the U.S. Attorney's Office.

Anti-Money Laundering Deficiencies

The indictment alleges that KuCoin failed to implement proper due diligence measures, know-your-customer (KYC) procedures, and other anti-money laundering (AML) safeguards required by U.S. law.

"KuCoin's actions allowed criminals to launder money through its platform and evade detection by law enforcement," said Damian Williams, U.S. Attorney for the Southern District of New York. "This indictment sends a clear message that we will not tolerate cryptocurrency exchanges that operate outside the law."

Concealing U.S. Users

The indictment further alleges that KuCoin deliberately concealed the number of U.S.-based customers on its platform to avoid regulatory scrutiny and evade U.S. law enforcement.

"KuCoin actively sought to deceive U.S. regulators by hiding the true extent of its U.S. customer base," said Darren McCormack, head of the Homeland Security Investigations New York Field Office. "This deception allowed KuCoin to profit from illegal activities and undermine the integrity of our financial system."

Potential Penalties

Chun Gan and Ke Tang are facing charges of violating the Bank Secrecy Act and money transmission laws. The indictment seeks forfeiture of all property derived from or used in the alleged illegal activity.

The defendants are scheduled to appear in court on a date yet to be determined. If convicted, they face significant prison time and financial penalties.

The Justice Department's investigation into KuCoin is ongoing. The government is committed to prosecuting cryptocurrency exchanges that violate U.S. law and pose a threat to the integrity of the financial system.