In the IRS’s list of top 10 criminal cases for 2023, cryptocurrency frauds are featured, ranging from multi-million dollar tax evasions to elaborate money laundering schemes.
Crypto Scams Among Most Significant Financial Crimes in IRS Criminal Investigation’s 2023 Report
The IRS Criminal Investigation (CI) division has released its annual list of the top 10 criminal cases for the year 2023, highlighting a significant focus on cryptocurrency-related crimes. The list, which was announced on the IRS website and IRS CI’s social media platforms, includes a variety of financial crimes ranging from international tax fraud to massive Covid-19 relief scams.
CI Chief Jim Lee underscored the range and complexity of this year’s cases, emphasizing the billions of dollars involved and the global impact of these crimes. “From international tax schemes to multi-level marketing involving cryptocurrency, our investigators have skillfully unraveled some of the most intricate financial frauds,” said Lee.
Among the top 10 cases, four are notably centered on cryptocurrency:
Amir Bruno Elmaani Sentenced in Crypto Tax Evasion: Coming in at number 8 on the IRS CI list is a man known as ‘Bruno Block,’ the founder of the cryptocurrency Oyster Pearl. Elmaani was sentenced to 48 months in federal prison. He was found guilty of evading taxes on profits from his Pearl tokens, leading to a tax loss of approximately $5.5 million. Elmaani’s lavish spending, including the purchase of yachts and homes, contrasted sharply with his reported income to the IRS.
Silk Road Bitcoin Seizure Leads to Conviction: Number 7 on the IRS CI list is James Zhong, who received a sentence of one year and one day for wire fraud related to the illicit acquisition of approximately 50,000 bitcoins from the infamous Silk Road dark web marketplace. The forfeiture of these bitcoins, valued at around $3.4 billion, marks one of the largest in history. Zhong’s elaborate scheme to conceal the stolen bitcoins spanned over a decade.
Bitcoin ‘Money Laundering’ Scheme Uncovered in New Hampshire: At Number 4 in the overall list is Ian Freeman. Freeman was sentenced to 96 months in prison for allegedly laundering over $10 million through bitcoin transactions. Freeman’s operation was accused of catering to fraudsters, bypassing anti-money laundering laws and misrepresenting transactions as church donations.
Onecoin Co-Founder Sentenced in Multibillion-Dollar Scheme: Finally, at number 3 is Karl Sebastian Greenwood, co-founder of Onecoin, who was sentenced to 20 years in prison for his role in the Onecoin fraud scheme. The scheme, which started in 2014, defrauded millions of investors worldwide, with losses exceeding $4 billion.
These high-profile cryptocurrency cases reflect the increasing scrutiny by law enforcement agencies on the use of digital currencies in criminal activities. The IRS CI’s focus on these cases demonstrates the agency’s growing proficiency and interest in investigating complex financial crimes that are natively digital.
The other cases on the list include international tax fraud, Covid-19 relief scams, and a billion-dollar biofuel tax fraud scheme, showcasing the variety of financial crimes tackled by the IRS CI in 2023.
As cryptocurrency becomes more prominent in society, it stands to reason there will be a commiserate uptick in crypto-related crimes. The IRS CI cases serve as a stark reminder of the potential for misuse and the importance of vigilance amongst crypto holders. These cases also serve as fodder for people and institutions demanding stronger regulations and oversight over all things crypto.
What do you think is the significance, if any, of the number of crypto-related cases in IRS CI’s top 10 list? Let us know in the comments section below.
