The IRS is prioritizing tax compliance for cryptocurrency investors. According to reports, last week the agency began sending letters to thousands of U.S. taxpayers warning of potential civil and criminal enforcement action if they do not amend their returns to accurately report any cryptocurrency-related income. "Taxpayers should take these letters very seriously by reviewing their tax filings and when appropriate, amend past returns and pay back taxes, interest and penalties," IRS Commissioner Chuck Rettig said in a statement. He further emphasized that the IRS is increasing its use of data analytics to expand its efforts involving this space.
Late last month in California, BTC-e, a now-defunct cryptocurrency exchange, and Alexander Vinnick, a Russian national and BTC-e senior executive, were indicted for money laundering, operating an unlicensed exchange and unlawful money services business, and other related charges. BTC-e reportedly touted itself as an anonymous way to trade cryptocurrency and, over its six years in operation, reportedly served 7,000,000 users who traded over $296 million worth of assets. The government charges that a significant amount of those assets were proceeds from illegal activity. The defendants face penalties of over $100 million. Vinnick is currently detained in Greece, with both the U.S. and Russia seeking his extradition.
The U.S. Attorney's Office of the Southern District of New York recently announced charges against Jon Barry Thompson, the principal of the cryptocurrency escrow company Volantis Escrow Platform LLC (Volantis). According to the government, Thompson induced investors to transfer millions of dollars to Volantis for further investment into cryptocurrencies. However, Thompson allegedly stole the funds instead of investing them. He faces up to 60 years in prison. Also in New York, Lawrence Ross was arrested for charges related to the importation, manufacture and distribution of over 10 kilograms of ecstasy and over 45 grams of methamphetamine. According to the government, Ross sold the drugs through the Dark Web and Wickr (an instant messenger application), distributed them through the U.S. mail, and accepted bitcoin as payment.
For more information, please refer to the following links:
- Crypto Tax Avoiders Face IRS Roulette: Fess Up or Try to Hide
- Crypto Investors Receiving IRS Letter 6174-A Don't Need To Panic, Here's Why
- Prosecutors File Formal Complaint Against Infamous BTC-e Crypto Exchange
- Russian Bitcoin Theft Suspect Sued for $100 Million by U.S.
- Principal Of Cryptocurrency Escrow Company Charged In Manhattan Federal Court With Fraudulent Scheme Involving Over $7 Million
- Brentwood Man Arrested for Distributing Ecstasy and Crystal Methamphetamine
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