The U.S. Department of Justice has accused KuCoin and its two founders of participating in money laundering activities knowingly.

According to the allegations, KuCoin, a cryptocurrency exchange, engaged in actions that violated the Bank Secrecy Act and regulations regarding unlicensed money transmission. The U.S. Department of Justice (DOJ) highlighted that the exchange's founders, Chun Gan and Ke Tang, allegedly attempted to conceal the presence of U.S. customers to circumvent Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements.

The DOJ claims that KuCoin operated without the necessary license for a money-transmitting business, which constitutes a clear violation of the Bank Secrecy Act. U.S. Attorney Damian Williams emphasized that KuCoin appeared to have disregarded the laws and regulations of the country.

Williams noted that the exchange processed transactions involving more than $5 billion in potentially suspicious and illicit funds.

Following the news, the price of the KuCoin token (KCS) dropped by 5%.

Deputy Special Agent in Charge for the U.S. Department of Homeland Security, Darren McCormack, underscored the significance of the indictment. McCormack described KuCoin's operations as an alleged large-scale criminal conspiracy, highlighting the exchange's expansion to serve over 30 million customers without adhering to the legal standards essential for the safety and integrity of the global digital finance ecosystem.

Gan and Tang, both Chinese citizens, remain fugitives. The charges against them and other associated parties could result in up to 10 years of imprisonment.