The world’s largest crypto exchange KuCoin admitted to running an unlicensed money-transmitting business within US borders. The company settled by agreeing to pay $300 million which contained both a $184.5 million forfeiture and a $112.9 million fine.
KuCoin will leave the United States market for two years while its founders Michael Gan and Eric Tang step down from managing the company. As part of their deferred prosecution agreement with the US Department of Justice, the company must forfeit $2.7 million to the agreement.
The legal dispute against KuCoin developed when investigators discovered inadequate Anti-Money Laundering (AML) and Know-your-customer (KYC) procedures. The Justice Department revealed that the exchange operated without user identification requirements until mid-2023 and its employees publicly declared KYC was optional.
KuCoin also neglected to complete registration with the US Treasury’s Financial Crimes Enforcement Network. Gan issued a statement on Jan. 28 which described the settlement as beneficial and he showed contentment with the resolution.
According to him, the DOJ agreed to drop all charges against both him and Tang following the fulfillment of specific conditions. KuCoin continues its operations worldwide while concentrating its efforts on enhancing both security measures and compliance standards.
The settlement mirrors BitMEX’s payment of $100 million to resolve US AML law violations.
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