Tax investigators from 5 countries including USA, UK, Canada, Australia and Netherlands have discovered a potential major fraud amounting to approximately $1 billion in a Ponzi scheme involving crypto transactions.
These tax investigators are part of an alliance namely J5 of the above 5 nations. These tax officials have been jointly analyzing intelligence and data of cross border crypto transactions relating to decentralized finance (DeFi) and nonfungible tokens (NFTs). They have focused on more than 50 leads on possible tax crimes which includes the possible $1 billion Ponzi scheme, as stated by a report by Bloomberg.
Jim Lee, Head of criminal investigations division of United States’ Internal Revenue Service department has been quoted by Bloomberg saying, “Some of these leads I’m talking about, they involve individuals with significant NFT transactions revolving around potential tax or other financial crimes throughout our jurisdictions.”
He further informed the reporters that one lead “appears to be a $1 billion Ponzi Scheme. That’s billion with a B and this lead also touches every single J5 country.”
As the investigations in the possible tax fraud cases are still going on, the officials refused to disclose further details about the leads. However, Mr. Lee told that major announcements with regard to the investigation and involved targets could be made within this month itself.
J5 – Joint Chiefs of Global Tax Enforcement was launched in 2018 by USA, UK, Canada, Australia and Netherlands as joint international agency to investigate international tax crimes and money laundering involving cryptocurrencies, NFTs and crypto assets etc.
According to official website of IRS, “The Joint Chiefs of Global Tax Enforcement (known as the J5) are committed to combatting transnational tax crime through increased enforcement collaboration. We will work together to gather information, share intelligence, conduct operations and build the capacity of tax crime enforcement officials.”
The news of possible $1 billion fraud involving Ponzi scheme has come at a time when cryptocurrencies, NFTs and overall crypto markets are already reeling under sudden losses in valuation. According to some reports, crypto investors have already lost nearly $270 billion of their invested value within this week.
Governments across the world are already wary of these cryptocurrencies and anonymity involved in crypto transactions. There have been reports of criminals and terrorists using cryptocurrencies for narcotics and terror financing. NFTs are reported to have been frequently used for money laundering. It becomes necessary for governmental agencies to keep special focus on crypto activities across the international boundaries.
Though the crypto and blockchain technology have been hailed as new age wonder technologies which cannot be manipulated, but there have been almost daily reports of hacking and fraud in crypto world with alarming frequency. Moreover, the crypto field is totally unregulated and unsupervised leaving many gullible common people vulnerable to be exploited by conmen.
