Damian Williams, the top prosecutor of the U.S. Southern District of New York, and Darren McCormack, the temporary head of HSI New York, have revealed charges against KuCoin and its founders, Chun Gan and Ke Tang.
The accusations pertain to illicit money transfer and violation of the Bank Secrecy Act, namely the absence of a comprehensive program to deter money laundering and terrorist funding, inadequate verification of client identities, and failure to disclose suspicious actions.
KuCoin’s endeavor to expand its U.S. customer base with the aim of becoming a leading cryptocurrency exchange has resulted in more than $9 billion worth of questionable transactions.
Crypto exchange KuCoin, established in September 2017, actively targeted American clients to expand its trading services and successfully attracted a global user base of over 30 million.
The exchange chose to disregard the legal obligations of registering with U.S. regulatory organizations such as FinCEN and adhering to anti-money laundering (AML) and consumer identification processes.
Gan and Tang are facing accusations for breaching the Bank Secrecy Act and operating an unauthorized money-transmitting company. Each charge carries a potential jail term of up to five years. KuCoin and its affiliated entities are confronted with comparable allegations, which may result in fines ranging from five to 10 years.
Three months back, KuCoin has agreed to halt operations in New York due to a lawsuit alleging illegal and unregistered securities and commodity sales. The agreement requires KuCoin to pay over $22 million, with $16.7 million for refunds to New York-based users and an additional $5.3 million to the NYAG.
