KuCoin Pleads Guilty to Unlicensed Money Transmitting, Pays $297 Million in Fines
KuCoin, a leading global cryptocurrency exchange, admitted guilt on Monday to operating an unlicensed money transmitting business. The company agreed to a settlement package comprising fines and forfeiture totaling over $297 million, as per the U.S. Department of Justice.
Operating as Peken Global Ltd, KuCoin entered its plea in Manhattan before U.S. District Judge Andrew Carter. The plea involves a $112.9 million criminal fine and $184.5 million forfeiture. Additionally, KuCoin must withdraw from the U.S. market for a minimum of two years.
Two KuCoin founders, Chun Gan (Michael) and Ke Tang (Eric), will face deferred prosecution for two years, forfeit $2.7 million, and relinquish all roles within KuCoin's management and operations.
Prosecutors cited KuCoin's facilitation of billions of dollars in potentially suspicious transactions, including those involving darknet markets, malware, ransomware, and fraud. These activities allegedly resulted from KuCoin's failure to implement effective anti-money laundering and know-your-customer programs.
The exchange also neglected to report suspicious transactions and register with FinCEN (Financial Crimes Enforcement Network) as required by U.S. law.
Founded in 2017, KuCoin boasts over 30 million registered users in over 200 countries. BC Wong, KuCoin's newly appointed CEO, reaffirmed the company's commitment to compliance, security, and innovation.
Wong stated that KuCoin aims to strengthen its global compliance measures and explore options for re-entering the market once licensed.
KuCoin's resolution mirrors the ongoing regulatory scrutiny in the cryptocurrency sector. In December 2023, the company reached a settlement with New York state for $22 million, agreeing to block users from the state and address registration deficiencies.
KuCoin holds the eighth position among global spot cryptocurrency exchanges based on metrics like traffic, liquidity, and trading volume.