The Department of Justice (DOJ) issued charges against cryptocurrency exchange KuCoin and two of its founders, Chun Gan and Ke Tang, for allegedly violating anti-money laundering laws. The indictment accuses KuCoin of operating an unlicensed money-transmitting business and breaching the Bank Secrecy Act. According to the DOJ, the exchange failed to implement an adequate anti-money laundering program, lacked proper procedures to verify customers' identities, and did not report suspicious activity.

The indictment claims that KuCoin circumvented US anti-money laundering (AML) and know-your-customer (KYC) regulations by falsely stating that it had no US-based customers, despite having a significant US customer base. The government alleges that KuCoin enabled money laundering activities totaling over $9 billion.

US Attorney Damian Williams for the Southern District of New York mentioned that KuCoin utilized its large US customer following to become a major global cryptocurrency exchange with substantial daily and yearly trade volumes. However, financial institutions operating in the US are required to adhere to US laws to detect and prevent unlawful financial schemes. The Commodity Futures Trading Commission also initiated a parallel civil action against KuCoin.

KuCoin's CEO Johnny Lyu acknowledged the charges but assured users that the platform's operations were unaffected and running as usual. The DOJ reported that the indicted founders, Gan and Tang, are still at large. If convicted of the charges filed against them, each founder could face a maximum of five years in prison.