The IRS Names Four Crypto Crimes to Its Top 10 Scams List
The Internal Revenue Service (IRS) has included four crypto-related scams on its top 10 scams list for 2023 in an effort to raise awareness among consumers. The IRS recently published a ranking of the ten most prominent investigations in 2023, with four of them involving cryptocurrency.
“Our investigators took down international tax schemes that preyed on people’s personal information, investigated multi-level marketing schemes involving cryptocurrency and uncovered one of the largest fraud schemes in history centered around renewable fuel credits.”
Jim Lee, IRS Criminal Investigation Chief
Highlights from the List
The first place on the list went to a businessman convicted of a billion-dollar biofuel tax fraud. In second place was a former financial director of a Russian gas company sentenced to over 7 years in prison for tax crimes and evading sanctions.
Crypto made its entry at number three on the IRS list with the OneCoin cryptocurrency pyramid scheme case. One of the project’s co-founders, Karl Sebastian Greenwood, was sentenced to 20 years in prison. However, Ruja Ignatova, known as the “Crypto Queen” and also involved in the OneCoin fraud, remains at large.
A New Hampshire resident ranked fourth on the list for running a scheme to launder over $10 million in Bitcoin. The seventh place went to a case involving a Silk Road hacker who stole 50,000 Bitcoins (BTC) from the darknet site.
On the eighth spot is Oyster Protocol founder Amir Bruno Elmaani, who was sentenced to four years in prison for failing to pay $5.5 million in taxes. Elmaani admitted to creating the Oyster Protocol scam and deliberately integrating flawed functions into the project’s smart contracts.
Crypto Asset Tax Evasion Cases
Between October 2022 and September 2023, nearly half of the IRS’s cases involved crypto asset tax evasion. This category includes traders who hide capital gains.
New Rules for the Cryptocurrency Sector
As the threat grows, the IRS is developing new rules for the cryptocurrency sector. In September, it was announced that the IRS and the U.S. Department of the Treasury have proposed new guidelines outlining reporting duties for crypto brokers.
Hot Take: IRS Targets Crypto Crimes in Top Scams List
The inclusion of four crypto-related scams on the IRS’s top 10 scams list for 2023 highlights the growing concern around fraudulent activities in the cryptocurrency space. With cases ranging from pyramid schemes to tax evasion and fraud, it is clear that crypto scams are a significant problem.
The IRS’s efforts to raise consumer awareness about these scams are commendable, as they aim to protect individuals from falling victim to such fraudulent schemes. The ranking serves as a reminder for crypto enthusiasts to exercise caution and due diligence when engaging in cryptocurrency transactions.
Furthermore, the IRS’s focus on developing new rules for the cryptocurrency sector demonstrates its commitment to regulating this evolving industry. By proposing guidelines for crypto brokers’ reporting duties, the IRS aims to enhance transparency and accountability within the crypto market.
Overall, the inclusion of crypto crimes in the top scams list underscores the need for continued vigilance and regulation in the cryptocurrency space to ensure its integrity and protect consumers from financial harm.
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