IRS Reveals Top 10 Crypto-Related Fraud Cases of 2023
The IRS Criminal Investigation (CI) has released its list of the top 10 cases from the previous year, highlighting significant incidents of fraud and criminal activity in the crypto space.
International Tax Schemes and MLM Scams Targeting Cryptocurrency
According to CI Chief Jim Lee, the investigations successfully dismantled international tax schemes that exploited individuals’ personal information. They also probed multi-level marketing schemes connected to cryptocurrency and uncovered one of the largest fraud schemes in history related to renewable fuel credits.
โWhen I say our team at CI is the best at following the money trail, I mean it.โ
Fraudulent Investment Schemes Involving Digital Currency
Four cases involving fraudulent investment schemes related to digital currency have made it to the list.
- Bruno Block, also known as Amir Bruno Elmaani, founder of Oyster Pearl cryptocurrency, has been sentenced to four years in federal prison. Elmaani orchestrated a tax evasion scheme by misrepresenting income related to the Pearl token. Despite significant expenditures, he falsely reported no income to the IRS, resulting in a tax loss of approximately $5.5 million.
- James Zhong received a one-year and one-day prison sentence for wire fraud related to Silk Road dark web fraud. He unlawfully obtained around 50,000 bitcoins from the Silk Road marketplace and executed a complex scheme to steal and conceal their source.
- Ian Freeman from New Hampshire was sentenced to 96 months in prison for operating a Bitcoin money laundering scheme. He facilitated money laundering by exchanging over $10 million from romance scams and internet fraud for Bitcoin.
- Karl Sebastian Greenwood, co-founder of the OneCoin cryptocurrency scheme, was sentenced to 20 years in prison. He and Ruja Ignatova orchestrated a massive fraud through a global multi-level marketing network, attracting over $4 billion in investments from millions of victims.
Hot Take: Crackdown on Crypto Fraud Continues
The IRS CI’s disclosure of its top 10 cases of 2023 highlights the ongoing efforts to combat crypto-related fraud and criminal activity. These cases serve as a reminder that authorities are actively pursuing those who engage in fraudulent schemes and illegal activities within the crypto industry. As cryptocurrencies gain popularity, it is crucial for individuals to exercise caution and conduct due diligence to avoid falling victim to scams. The IRS CI’s dedication to following the money trail demonstrates their commitment to protecting individuals and ensuring the integrity of the financial system.
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