KuCoin Appeals C$19.4 Million Penalty in Canada

Cryptocurrency exchange KuCoin is challenging a C$19.4 million ($14 million) penalty imposed by Canada's anti-money laundering watchdog, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).

FINTRAC said Seychelles-based Peken Global Limited, which operates KuCoin, failed to register as a money-services business in Canada and neglected its reporting duties between 2021 and 2024. The regulator accused the firm of not reporting nearly 3,000 large-value crypto transactions and failing 33 times to file reports on activity it suspected could involve money laundering or terrorist financing. It described the violations as "serious" and, in some cases, "severe."

Under Canadian law, crypto trading platforms that handle virtual currency transactions must register with FINTRAC. Large-value transactions, defined as those above C$10,000, must be reported, and suspicious activity reports are regarded as central to the country's AML framework. Fines can reach up to C$500,000 per violation.

KuCoin said it has appealed the ruling to the Federal Court of Canada "on both substantive and procedural grounds." In its statement, the company argued the fine was "excessive and punitive in nature" and questioned FINTRAC's designation of the platform as a foreign money-services business. Legal observers suggest the appeal could test how far Canadian regulators can extend AML rules to overseas firms that serve Canadian users.

The case is FINTRAC's largest enforcement action in the past year, representing most of the C$25 million in total penalties levied across 23 cases. By comparison, the previous record fine was C$7.4 million against Binance Canada in 2023, which preceded Binance's withdrawal from the Canadian market.

KuCoin has faced similar actions abroad. In 2023, the Ontario Securities Commission penalized the platform, and earlier this year it settled with the U.S. Department of Justice for nearly $300 million over licensing violations. That settlement included forfeiting $150 million in illicit proceeds and agreeing to compliance monitoring for three years.

Globally, KuCoin ranks among the top five exchanges by trading volume, processing over $2 billion daily according to CoinMarketCap. Authorities in Singapore, South Korea, and the Netherlands have also issued warnings or restrictions against the firm in recent years, reflecting the wider scrutiny facing offshore crypto platforms.