KuCoin pleads guilty, agrees to pay nearly US$300 million in US crypto case
KUCOIN, one of the world’s largest cryptocurrency exchanges, pleaded guilty on Monday to operating an unlicensed money transmitting business, and agreed to more than US$297 million in fines and forfeiture, the US Department of Justice said.
Peken Global, which operates as KuCoin, entered its plea before US District Judge Andrew Carter in Manhattan.
The plea includes a US$112.9 million criminal fine and US$184.5 million forfeiture, and calls for KuCoin to exit the US market for at least two years.
Two KuCoin founders - Chun Gan, known as Michael; and Ke Tang, known as Eric - each agreed to enter two-year deferred prosecution agreements, forfeit US$2.7 million, and cede any role in KuCoin’s management and operations, the Justice Department said.
Prosecutors said Seychelles-based KuCoin had been used to facilitate billions of dollars of suspicious transactions, and to transmit potential criminal proceeds including from darknet markets and malware, ransomware and fraud.
This resulted from KuCoin’s alleged failure to implement effective anti-money laundering and know-your-customer programmes.
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KuCoin also failed to report suspicious transactions or register with the US Department of the Treasury’s Financial Crimes Enforcement Network, or FinCEN, prosecutors said.
Founded in 2017, KuCoin had more than 30 million registered users in at least 207 countries and territories as of March 2024, court papers show.
“This resolution signifies a new chapter for KuCoin, one that reaffirms our dedication to compliance, security and innovation,” BC Wong, who was named KuCoin chief executive last week after serving as chief legal officer, said in a statement.
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“We are focusing on strengthening our global compliance practices and exploring opportunities to reenter the market with the necessary licenses,” Wong added.
Alexander Wilson, a lawyer for Gan, in a statement said the resolution reflected his client’s lack of intent to violate US law or be involved in money laundering, fraud and similar criminal activity.
David Meister, a lawyer for Tang, declined to comment.
In December 2023, KuCoin agreed to block New York users and pay US$22 million to settle that state’s lawsuit accusing it of failing to register.
KuCoin is the world’s eighth-largest cryptocurrency spot exchange based on factors including traffic, liquidity and trading volumes, according to data company CoinMarketCap. Binance and Coinbase are among higher-ranking exchanges. REUTERS
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