U.S authorities charge Bitcoin evangelist Roger Ver with tax fraud

This week, the Department of Justice brought forth criminal tax fraud charges against Roger Ver, a prominent Bitcoin investor known as "Bitcoin Jesus" for his early involvement in the digital currency and subsequent wealth accumulation.

Ver stands accused of evading taxes amounting to at least $48 million, as per the indictment unveiled on Tuesday.

The indictment, filed in a federal court in California, alleges that Ver engaged in a scheme to defraud by not fully disclosing ownership of 131,000 bitcoins in 2014, the year he relinquished his U.S. citizenship to become a citizen of St. Kitts and Nevis in the Caribbean.

Back then, each bitcoin was valued at around $871. As of Wednesday morning, with bitcoin trading at $57,416 per unit, Ver's 131,000 bitcoins would amount to over $7.5 billion.

To embark on the journey of becoming a U.S. expatriate entails fulfilling specific tax obligations to the Internal Revenue Service (IRS). However, according to the Department of Justice (DOJ), Roger Ver purportedly skirted these responsibilities by understating the extent of his bitcoin assets and consequently evading the requisite taxes.

Moreover, the indictment asserts that following his departure from the U.S., Ver persisted in inaccurately disclosing his Bitcoin holdings despite being obligated to fulfill U.S. tax liabilities on these assets.

Ver was apprehended in Spain over the weekend, with the United States now seeking his extradition to stand trial on eight charges encompassing tax evasion, mail fraud, and the submission of false tax returns.

Defense Decries Charges as Unjust

Bryan Skarlatos, representing Ver, expressed disappointment and surprise regarding the arrest while in transit in Spain. He conveyed, "This prosecution never should have been brought." Skarlatos emphasized that Ver had relied on esteemed tax professionals to accurately report his Bitcoin holdings and had always intended to adhere fully to his U.S. tax obligations. He asserted their readiness to establish Ver's innocence in court if deemed necessary.

Should Ver be convicted of these felonies, it could result in a return to federal prison, reminiscent of his previous 10-month incarceration in 2002. This stint followed a guilty plea for the sale of explosives named "Pest Control Report 2000" on the online marketplace eBay.

Throughout the tumultuous trajectory of Bitcoin's rise and fall over the last decade, governmental scrutiny has intensified towards potential financial misconduct linked to the digital currency. In response to Bitcoin's growing prominence, the IRS has heightened its efforts to enhance surveillance and monitoring of Bitcoin investors.

As the currency has gained greater acceptance in mainstream financial circles, the IRS has endeavored to refine its methodologies, employing advanced techniques such as "clustering analysis" to meticulously trace Bitcoin transactions on the blockchain. This sophisticated strategy was utilized by the IRS to pinpoint and identify Ver's specific Bitcoin transactions, as detailed in the indictment.

Roger Ver Earns First Million in 2011

In 2011, Ver achieved his inaugural million-dollar milestone through Bitcoin, coinciding with his initiation into trading the digital currency, as detailed in a 2013 CNBC profile.

As he continued to infuse investments into Bitcoin and advocate for its adoption, he began to garner a reputation within the community akin to that of a messianic figure.

Ver recounted to CNBC in 2013 an incident where Peter Vessenes, the Bitcoin Foundation's founder, bestowed upon him the moniker "Bitcoin Jesus" after witnessing his compelling explanation of the cryptocurrency to a group of high school students.

In Ver's recollection, Vessenes remarked, "It's as though you are a Bitcoin Jesus, surrounded by your disciples," as the students hung on his every word, captivated by the potential of Bitcoin.