IN BRIEF

Leading international cryptocurrency exchange KuCoin and two of its founders are being sued by the Commodities and Futures Trading Commission (CFTC) and the U.S. Department of Justice for allegedly breaking the Bank Secrecy Act and Unlicensed Money Transmission.

In their announcement, the US Department of Justice claimed that by making KuCoin one of the biggest cryptocurrency exchanges globally, Chun Gan and Ke Tang, the company's co-founders, had broken US anti-money laundering laws.

At this point, an indictment was brought against KuCoin and its creators Chun Gan and Ke Tang, according to Southern District of New York Attorney General Damian Williams and Acting Special Agent in Charge of the New York Homeland Security Investigations Field Office ("HSI") Darren McCormack.

According to this indictment, cryptocurrency exchange KuCoin and its founders Chun and Ke Tang are accused of conspiring to operate an unlicensed money transmission business and conspiring to violate Bank Secrecy.

US Attorney for the Southern District of New York Damian Williams said the following about the Kucoin case:

As alleged in today's Indictment, KuCoin and its founders deliberately attempted to conceal the fact that a significant number of US users were transacting on the KuCoin platform.

Indeed, KuCoin has allegedly leveraged its large US customer base to become one of the largest cryptocurrency derivatives and spot exchanges in the world, with billions of dollars in daily transactions and trillions of dollars in annual trading volume.

But taking advantage of unique opportunities in the United States, financial institutions like KuCoin must also comply with U.S. laws to help detect and dismantle crimes and corrupt financing schemes. However, KuCoin allegedly deliberately chose not to do this.

The defendants allegedly failed to enforce even basic anti-money laundering policies, allowing KuCoin to operate in the shadow of financial markets and be used as a haven for illegal money laundering.

“Today's Indictment should send a clear message to other cryptocurrency exchanges: If you plan to serve US customers, you must comply with US law, plain and simple.”