Centralized exchanges (CEX) are under scrutiny for their role in money laundering, despite implementing Know Your Customer (KYC) and compliance measures. A recent analysis reveals that these platforms remain a significant vulnerability in the anti-money laundering (AML) framework, as they are often used to convert cryptocurrencies into fiat currency. This process allows illicit funds to flow through, highlighting potential regulatory loopholes and questioning the effectiveness of current operational protocols. The report calls for enhanced controls and improved cross-platform data sharing to mitigate these risks. It suggests that more granular oversight could help address the persistent challenges in preventing money laundering through CEX, ensuring that compliance measures are not just procedural but also effective in practice.