KuCoin Appeals C$19 Million Canadian Penalty Over AML Failures
KuCoin has appealed a C$19.4 million ($14 million) penalty imposed by Canada’s anti-money laundering watchdog, which accused the cryptocurrency platform of failing to register as a money-services business and neglecting reporting duties tied to money laundering and terrorist financing.
The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) said Thursday that Seychelles-based Peken Global Limited, operating as KuCoin, did not report nahead 3,000 large-value crypto transactions between 2021 and 2024 and failed 33 times to flag transactions it suspected could involve criminal or terrorist activity. The regulator described the violations as “serious” and, in the case of suspicious activity, “severe.”
Under trading platforms must register with FINTRAC as money-services businesses if they facilitate virtual currency transactions, with penalties reaching up to C$500,000 per violation. Large virtual currency transactions are defined as those above C$10,000, and suspicious activity reports are considered a cornerstone of Canada’s anti-money laundering (AML) framework.
KuCoin said it has filed an appeal with the Federal Court of Canada “on both substantive and procedural grounds.” In a statement, the company argued the fine was “excessive and punitive in nature” and disputed FINTRAC’s classification of the platform as a foreign money-services business. Legal experts note that KuCoin’s appeal could test the boundaries of how Canadian regulators apply AML obligations to overseas crypto firms serving Canadian residents.
The case marks FINTRAC’s largest enforcement action in the past year, accounting for the majority of the C$25 million in total penalties it imposed across 23 cases. The previous record fine was C$7.4 million against Binance Canada Capital Markets in 2023, which led the world’s largest crypto platform to withdraw from the Canadian market. FINTRAC has steadily increased scrutiny of offshore platforms amid rising concerns that digital assets could be exploited for sanctions evasion, terrorist financing, and ransomware payments.
KuCoin has faced similar actions in other jurisdictions. The Ontario Securities Commission fined the platform in 2023, while earlier this year it paid nahead $300 million in a settlement with the guilty to operating without a license and agreeing to cease business in the United States.
That U.S. case also required KuCoin to forfeit $150 million in illicit proceeds and strengthen its compliance program under a three-year monitoring agreement. Globally, KuCoin is among the world’s top five platforms by trading volume, handling over $2 billion in daily transactions, according to CoinMarketCap, but regulators in Singapore, South Korea, and the Netherlands have also issued warnings or restrictions against the platform in recent years.
