The US Federal Prosecutor's Office has filed a complaint against cryptocurrency platform KuCoin and its two creators, entrepreneurs Chun Gang and Ke Tang.
According to an official law enforcement statement, the defendants jointly operated an unauthorized money transfer business in the United States. The company and its co-founders also face charges of violating the Bank Secrecy Act and defrauding investors.
Authorities allege that KuCoin's management intentionally failed to implement Know Your Customer (#KYC) and Anti-Money Laundering (#AML) schemes. According to the official statement, KuCoin circumvented these protocols despite KuCoin having over 30 million users.
The defendants allowed KuCoin to operate surreptitiously in the financial sector without even establishing basic AML rules. The platform became a haven for illicit financial transactions.
"As a result, KuCoin accepted more than $5 billion and transferred more than $4 billion in suspicious and criminal funds," said federal prosecutor Damian Williams.
Law enforcement authorities claim that KuCoin should have received authorization to operate from the Financial Crimes Enforcement Network (FinCen) and the U.S. Commodity Futures Trading Commission (CFTC). However, the company ignored these conditions.
"This indictment is intended to provide clear guidance to other companies. If you intend to work with clients in the US, compliance is non-negotiable," emphasizes Williams.
The co-founders of the platform, Gan and Tan, are Chinese nationals. They are charged with two violations of the Bank Secrecy Act and fraud. The businessmen face a five-year prison sentence on each charge.
Organizations associated with #KuCoin activities are also accused of violating four #US laws. Potential penalties for each offense range from five to ten years in prison.
