Canada Slaps KuCoin with Record $14 Million Fine for AML Violations
Canadian regulators just dropped the hammer on one of crypto's biggest players.
KuCoin faces a staggering $14 million penalty—the largest AML fine in Canadian history against a cryptocurrency exchange. The crackdown signals regulators are done playing nice with platforms that skirt financial safeguards.
Where Compliance Broke Down
The exchange failed basic customer verification checks and transaction monitoring—the bare minimum for operating in regulated markets. Canadian authorities uncovered systemic gaps in KuCoin's anti-money laundering protocols that left the door wide open for illicit flows.
Regulators Get Teeth
This isn't a warning shot—it's a full-scale regulatory assault. The unprecedented fine shows watchdogs now have both the legal framework and enforcement appetite to pursue crypto giants operating on their turf. Other exchanges are scrambling to audit their compliance stacks.
Another 'move fast and break things' strategy meets regulatory reality—turns out financial crime safeguards aren't optional, even in crypto-land.
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. The FINTRAC claims that KuCoin neglected to file 33 suspicious transaction reports. FINTRAC classified the breaches as “serious” to “very serious,” saying such gaps weaken defenses against money laundering and terrorist financing.
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.
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.
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.
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.
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.
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.
Despite pressure, 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.
