KuCoin’s $14M Woes: A Tale of Crypto and Confusion 🚨

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Canada’s financial intelligence unit has levied a record C$19.6 million ($14 million) fine on Peken Global Limited, operator of crypto exchange KuCoin, for failing to comply with anti-money laundering (AML) requirements.

The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) announced the penalty on Thursday, citing three violations. One might assume this is a game of regulatory chess, but KuCoin has clearly forgotten how the pieces move.

Largest Penalty Imposed by FINTRAC

The Seychelles-based company did not register as a foreign money services business, and allegedly failed to report nearly 3,000 large virtual currency transactions above C$10,000 between 2021 and 2024. FINTRAC claims KuCoin neglected to file 33 suspicious transaction reports. These breaches were deemed “serious” to “very serious,” a classification that might as well be a red pen waving a white flag. Such gaps, FINTRAC insists, weaken defenses against money laundering and terrorist financing-though one suspects even Al Capone might have raised an eyebrow at this particular display of negligence.

Canada has also tightened oversight of payment providers. On September 8, key provisions of the Retail Payment Activities Act took effect, placing wallet and stablecoin operators under the supervision of the Bank of Canada, with new safeguards for funds and risk controls. The Bank of Canada outlined implementation milestones and described the registration framework. Naturally. Because nothing says “economic security” like a bureaucracy so convoluted it could baffle a tax accountant.

Sarah Paquet, FINTRAC’s director and chief executive, said the regime exists to protect “the safety of Canadians and the security of Canada’s economy,” adding the agency will act when firms fail to meet obligations. A noble sentiment, if only KuCoin had bothered to read the rulebook-or perhaps a dictionary.

KuCoin Appeals and Global Context

KuCoin said it has appealed to Canada’s Federal Court, calling the fine “excessive and punitive” while disputing its classification as a foreign money services business. Ever the optimist, they argue the fine is akin to “punishing a child for misplacing their socks.”

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 legal avenues by submitting an appeal before the Federal Court of Canada to ensure a fair outcome for KuCoin. As always, we remain fully committed to transparent operations and compliance with all applicable laws.
— KuCoin, via X

This is not KuCoin’s first regulatory clash. In January, the exchange pleaded guilty in the United States to running an unlicensed money-transmitting business and paid nearly $300 million. Its co-founders, Chun Gan and Ke Tang, resigned under that settlement. One might say they’ve mastered the art of the exit strategy-though not in the way they intended.

Canadian enforcement has also intensified. The Royal Canadian Mounted Police dismantled TradeOgre in a record seizure, and on Sept. 18 confiscated C$56 million from another unregistered exchange. Japan likewise banned five platforms, including KuCoin, for operating without registration. It’s a global game of regulatory whack-a-mole, and KuCoin keeps popping up like a stubborn dandelion.

The same day, the Bank of Canada urged federal stablecoin rules, citing systemic risk, as Ottawa prepares for a November audit by the Financial Action Task Force. Meanwhile, KuCoin continues expanding. Thailand’s Ministry of Finance selected the exchange to help launch a $153 million tokenized bond program, opening sovereign debt to retail investors via blockchain. Perhaps the Thais believe in second chances-or maybe they just enjoy a good gamble. 🤷‍♂️💸

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2025-09-26 17:58