IRS Accused of Harassment by Blockchain Expert Amidst Crypto Crime Investigations
Summary:
Blockchain expert ZachXBT has publicly complained about the aggressive tactics used by the IRS's Criminal Investigation Division to seek his help in blockchain investigations. He alleges that the unit has gone beyond his personal boundaries by showing up at previous homes, accessing private emails, and mailing letters, despite having public contact methods. This follows his refusal to assist investors involved in a discontinued memecoin project. Despite this, the IRS continues to expand partnerships within the blockchain tracing industry and had reportedly seized $10 billion worth of cryptocurrency related to various crimes.
Blockchain sleuth, ZachXBT has publicized his complaints of overzealous outreach from the Criminal Investigation Division (CID) of the US Internal Revenue Service (IRS), who need his help in blockchain-related inquiries. In a blog post on March 6, ZachXBT conveyed his frustration regarding the pursuit by the American law enforcement unit, which he believe crossed his personal boundaries, despite his willingness to assist victims and provide critical information in their investigations of blockchain criminal activities. He accuses the agency of showing up at previous homes, accessing private email data, and sending mailed letters despite public contact methods being freely accessible.
In the documents shared by ZachXBT that provide proof of his interactions with the IRS, one of the emails highlights an IRS-CID agent calling his blockchain tracing work “impressive”. The agent admits in the message that, despite having a long tenure as a special agent, his understanding of the crypto and cyber world is quite limited, and therefore is seeking for ZachXBT’s assistance on areas to focus on for significant impact.
ZachXBT argues that these multiple forms of outreach show a clear lack of professional decorum. This follows his refusal to help investors of the Base blockchain memecoin dubbed Complex (SIMPLE) after its creators abruptly discontinued it on April 4. ZachXBT cited his great dislike for wasting time helping individuals who knowingly take risks on uncertain meme coins compared to helping genuine victims.
In related news, the IRS has been progressively partnering with significant persons and firms within the area of blockchain tracing. The CID's Chief, Jim Lee, publicly stated in May 2023, as reported by Cointelegraph, how their partnership with blockchain analysis company Chainalysis proved to be immensely beneficial. He stated that without the structure and the tools now at their disposal, investigating cybercrimes linked to cryptocurrency would otherwise be “impossible”. The estimation made by IRS-CID was that digital assets related to a wide-ranging portfolio of crimes roughly worth $10 billion had been seized since it started its investigations.
Published At
4/6/2024 3:36:45 AM
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