- The settlement follows a March 2024 criminal indictment.
- Two KuCoin co-founders will step down.
- The crypto exchange will pay $297 million.
New York City’s top federal prosecutor just notched another victory against a crypto company.
On Monday, Danielle Sassoon, the newly appointed interim head of the Manhattan US attorney’s office, announced that the federal government had reached a settlement with KuCoin, one of the world’s largest crypto exchanges.
The Seychelles-based firm pleaded guilty to one count of violating US anti-money laundering laws.
KuCoin failed to implement effective anti-money laundering and know-your-customer programmes, report suspicious transactions, and did not register with the US Department of Treasury’s Financial Crimes Enforcement Network, said the Justice Department.
The crypto exchange agreed to pay more than $297 million. It will also exit the US market for at least two years.
Two of KuCoin’s founders, Chun Gan and Ke Tang, who were also facing criminal charges, agreed to step away from all operations within the exchange.
“Today’s guilty plea and penalties show the cost of refusing to follow these laws and allowing unlawful activity to continue,” Sassoon said in a statement.
In its own statement, KuCoin said it was “pleased” to have reached a settlement with the DOJ.
“While resolving regulatory challenges in the US, we want to reassure our global users that our operations in other non-restrictive markets remain fully unaffected,” it said.
Crypto criminals
The guilty plea follows a 2023 settlement KuCoin reached with the New York Attorney General.
The exchange paid more than $22 million in penalties for failing to register as a securities and commodities broker-dealer in New York and agreed to not operate in the state.
In March 2024, the federal government indicted KuCoin.
Prosecutors alleged the company did not have a mandatory know-your-customer process from 2017 until 2023.
“KuCoin employees regularly and frequently stated on public social media sites that KYC was not mandatory on KuCoin,” wrote the Justice Department.
The crypto exchange is one of a number of high-powered crypto companies that Sassoon and her office have investigated.
She and her colleagues in New York City have also prosecuted FTX co-founder Sam Bankman-Fried, and Terraform Labs co-founder Do Kwon.
Bankman-Fried was convicted of seven counts of fraud and conspiracy and sentenced to 25 years in prison for his role in the FTX scandal. He has appealed his conviction.
Kwon is set to stand trial in New York after a long extradition battle in Montenegro.
Crypto market movers
- Bitcoin rose 3.8% in the past 24 hours to trade around $102,866.
- Ethereum is also up 4.3% over the same period to $3,197.
What we’re reading
- Ethereum developers pledge cooperation as Ether’s woes trigger ‘wartime’ mindset ― DL News
- Did DeepSeek just tank markets? ― Milk Road
- Uh-oh! Crypto has a data problem ― Milk Road
- DeepSeek’s Rise Causes Crypto AI Tokens to Fall Harder Than TradFi Stocks ― Unchained
- Humanity Protocol raises $20m to challenge Sam Altman’s Worldcoin ― DL News
Ben Weiss is DL News’ Dubai Correspondent. Got a tip? Email at bweiss@dlnews.com.
