Kucoin pleads guilty to U.S. AML and KYC violations, faces $297M penalties, a two-year U.S. market exit, and forfeitures tied to darknet crimes.
DOJ Uncovers Billions in Suspicious Transactions Linked to Darknet Activities
Peken Global Ltd., the operator of cryptocurrency exchange Kucoin, has pleaded guilty to operating an unlicensed money transmitting business, according to the U.S. Department of Justice (DOJ). The company admitted to violating anti-money laundering (AML) and know-your-customer (KYC) regulations, facilitating billions in suspicious transactions, including proceeds linked to darknet markets and malware schemes. As part of the settlement, Peken will pay over $297 million in monetary penalties.
Founders Barred From Operations
Two Kucoin founders, Chun Gan and Ke Tang, indicted in March 2024, are barred from the company’s management. The DOJ also revealed their agreement to forfeit $2.7 million each. Additionally, they will cease operations in the U.S. for at least two years.
Years of Compliance Failures
The app launched in 2017 but only implemented a mandatory KYC program in August 2023. This delay left significant compliance gaps, enabling illicit transactions. The DOJ highlighted Kucoin’s role in transmitting billions of dollars in potentially criminal proceeds.
Kucoin’s Response and Future Plans
In a statement on social media, Kucoin announced the settlement as a “major step forward” while assuring global users that its operations in non-restrictive markets remain unaffected. The company reiterated its commitment to compliance and innovation.
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