Canada’s FINTRAC Slaps $14 Million Fine On KuCoin

Canada’s anti-money laundering agency has imposed a C$19.6 million ($14.09 million) penalty on Peken Global Limited, the operator of KuCoin, for failing to comply with Canadian anti-money laundering policies. 

KuCoin has appealed the decision in a Canadian federal court. The exchange pleaded guilty to operating an unlicensed money-transmitting business in the US, and paid $300 million in fines and forfeitures. 

KuCoin Hit With $14 Million Fine 

Canada’s Financial Transactions and Reports Analysis Center (FINTRAC) has imposed a C$19.6 million ($14.09 million) penalty on KuCoin for failing to comply with Part 1 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. FINTRAC stated that Seychelles-based Peken Global, the entity operating KuCoin, did not register as a foreign money services business, failed to report large virtual currency transactions of over C$10,000, and did not flag suspicious transaction reports as required by financial institutions operating in the country. FINTRAC Director and CEO Sarah Paquet stated, 

“Canada’s Anti-Money Laundering and Anti-Terrorist Financing Regime is in place to protect the safety of Canadians and the security of Canada’s economy.”

Paquet added that while FINTRAC works with businesses to help them comply with laws, it will take appropriate action when needed. 

“FINTRAC works with businesses to help them understand and comply with their obligations under the Act. We are also firm in ensuring that businesses continue to do their part, and we will take appropriate actions when they are needed.”

KuCoin Appeals Decision 

KuCoin has appealed the decision, formally submitting an appeal before Canada’s Federal Court on substantive and procedural grounds. The exchange stated that it remains committed to transparency and regulatory compliance, but disagrees with FINTRAC that it is a Foreign Money Services Business and the penalty imposed on it. The exchange released a statement, 

“While KuCoin respects the decision-making process and remains committed to regulatory compliance and transparency, it disagrees with both the finding that KuCoin is a Foreign Money Services Business and the penalty imposed, which KuCoin maintains is excessive and punitive in nature.”

The appeal allows KuCoin to challenge the decision in a formal legal setting. KuCoin views this as a crucial step towards regulatory clarity and fair treatment of digital asset platforms. Meanwhile, the exchange has assured users they will see no change in its commitment to security, transparency, and services during the legal proceedings. KuCoin CEO BC Wong stated, 

“KuCoin has always strived to work constructively with regulators worldwide. We disagree with this decision on both substantive and procedural grounds, and we have pursued all available legal avenues to ensure a fair outcome for KuCoin. As always, we remain fully committed to transparent operations and compliance with all applicable laws.”

KuCoin was founded in 2017 and is a leading global crypto platform serving over 40 million users across 200 countries.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.