IRVINE, Calif., Jan. 9, 2025 /PRNewswire/ — In a landmark enforcement action, the Internal Revenue Service (IRS) and the U.S. Department of Justice (DOJ) recently secured what is essentially the first criminal tax evasion conviction exclusively centered on cryptocurrency. The defendant, Frank Richard Ahlgren III of Austin, Texas, was sentenced to two years in federal prison and ordered to pay over one million dollars in restitution for willfully underreporting gains from selling approximately four million dollars worth of Bitcoin. Ahlgren—who began purchasing Bitcoin in 2011—allegedly inflated his cost basis to reduce his taxable income, withheld substantial portions of his Bitcoin proceeds from his 2017 tax return, and then failed to report an additional six hundred and fifty thousand dollars in Bitcoin sales over the following two years. Acting Special Agent in Charge Lucy Tan of IRS Criminal Investigation’s Houston Field Office underscored that this is the first purely tax-focused crypto prosecution, sending a clear signal that digital-asset tax infractions—absent other criminal factors like money laundering—can still trigger life-altering ramifications and incarceration.
This case highlights how many taxpayers in the cryptocurrency arena tend not to be risk-averse, often underestimating the potentially catastrophic consequences of a clandestine IRS criminal tax investigation. When the sole alleged offense is criminal tax noncompliance, the government’s readiness to seek prison time should serve as a sobering reminder that swift and deliberate damage control is critical whenever an IRS criminal tax investigation or high-risk audit (such as eggshell or reverse eggshell audit) may be on the horizon.
The Roger Keith Ver Indictment: “Bitcoin Jesus” Faces Tax Evasion Allegations
While Ahlgren’s prosecution demonstrates the government’s willingness to levy criminal tax penalties for purely tax-based crypto misconduct, another significant enforcement action broadens the scope even further. Roger Keith Ver, known worldwide as “Bitcoin Jesus” for his early Bitcoin advocacy, faces an eight-count federal indictment in the Central District of California—including criminal tax charges of mail fraud, tax evasion, and subscribing to false tax returns. Prosecutors allege that Ver renounced his U.S. citizenship yet failed to satisfy the so-called “exit tax“ on his personal and corporate-held Bitcoin—collectively over one hundred and thirty-one thousand coins worth hundreds of millions of dollars by late 2017. By purportedly concealing the actual extent of these positions—particularly within his companies MemoryDealers.com Inc. and Agilestar.com Inc.—Ver is alleged to have caused a forty-eight million dollar tax loss to the United States.
Arrested in Spain, Ver now faces potential extradition to stand trial in the U.S. If convicted, he could receive up to twenty years per mail fraud count, five years for each tax evasion charge, and three years for each false return offense. Although Ver remains presumed innocent unless proven guilty beyond a reasonable doubt, his case illuminates how expatriation or foreign citizenship does not necessarily insulate individuals from federal taxing authorities—particularly if their income streams or business entities remain U.S.-connected. Consequently, this indictment foreshadows covert IRS investigative procedures that can reach far beyond America’s borders to apprehend individuals suspected of egregious tax violations.
John Doe Summonses and High-Risk Letters: The IRS Casts a Wider Net
Bolstered by these high-profile investigations and prosecutions, the IRS and DOJ have made it abundantly clear that “
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