KuCoin and DOJ Settlement: KuCoin Faces Two-Year U.S. Market Exit and Major Penalties
The Department of Justice announced on January 27 that PEKEN Global Limited, doing business as KuCoin, has pled guilty in a Manhattan federal court as part of a settlement agreement. As a result of the plea, KuCoin will be banned from the US market for two years and lose $184.5 million in addition to a $112.9 million punishment. In a deferred prosecution agreement, the exchange’s founders, Michael Gan and Eric Tang, will also lose $2.7 million and renounce all management and operational involvement in KuCoin.
KuCoin, Gan, and Tang were charged by authorities in March with lacking efficient Know Your Customer and Anti-Money Laundering initiatives. This state of affairs persisted until July of last year, according to the Justice Ministry.
KuCoin did not require customers to provide any identifying information. KuCoin employees repeatedly stated on public social media sites that KYC was not mandatory on KuCoin, including in response to posts from customers who had identified themselves as being in the US,
DOJ
KuCoin CEO Steps Down: BC Wong Takes the Helm Amid DOJ Settlement
Gan announced in a statement on January 28 that the settlement was a favorable outcome and that BC Wong, KuCoin‘s chief legal officer, would be taking over as CEO. After meeting specific requirements, Gan stated that the Justice Department dismissed all charges against him and Tang. According to him, the agreement offers much-needed clarity and lays out a clear course for KuCoin’s future.
I appreciate the DOJ’s constructive approach in reaching this resolution, which reflects my lack of any intent to violate US law or involvement in money laundering, fraud, or similar criminal actions,
Gan
On the other hand, KuCoin stated that there has been no impact on its operations in other markets and that it has made great progress in fortifying its platform security and compliance framework.
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