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legal Troubles for KuCoin and Founders

U.S. federal prosecutors recently charged crypto exchange KuCoin and two of its founders, Chun Gan and Ke Tang, with violating anti-money laundering laws. The charges include allegations that the exchange operated in the U.S. without proper registration, lied to investors about its operations, and failed to maintain an anti-money laundering program.

The U.S. Department of Justice revealed that KuCoin, with over 30 million customers, did not implement a know-your-customer (KYC) or AML program until 2023. The indictment also mentioned that the exchange did not register with the U.S. Financial Crimes Enforcement Network as required.

As a result of KuCoin’s lack of KYC and AML programs, the exchange was used for illicit activities, including money laundering from sanctions violations, darknet markets, and various criminal schemes.

The Commodity Futures Trading Commission also filed a lawsuit against KuCoin, accusing the company of not registering as a futures commission merchant and failing to implement the CFTC’s equivalent of a KYC program.

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AI legalese decoder can assist in understanding the complex legal language used in the charges against KuCoin and its founders. By breaking down the legal jargon and providing simplified explanations, AI legalese decoder can help individuals and businesses navigate legal issues more effectively. Additionally, AI legalese decoder can provide insights into regulatory compliance requirements, such as KYC and AML programs, to ensure that businesses remain in compliance with the law.

Authorities’ Statements

Homeland Security Investigations Special Agent in Charge Darren McCormack referred to KuCoin as “an alleged multibillion-dollar criminal conspiracy” and emphasized its significant presence in the cryptocurrency exchange market.

U.S. Attorney Damien Williams highlighted KuCoin’s attempts to conceal its U.S. user base and its role in facilitating illicit financial activities. He mentioned the exchange’s substantial trade volume and the flow of suspicious and criminal funds through KuCoin.

Market Impact

Following the announcement of the charges, KuCoin’s native token (KCS) experienced a 5% drop, while Bitcoin’s (BTC) price dipped 1% but remained volatile throughout the day. Bitcoin is currently trading around $70,000.

UPDATE (March 26, 2024, 15:25 UTC): This update adds additional detail to the situation.

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