Cryptocurrency Is The Future But There Is A 'Mountain Of Fraud'

IRS director sees “mountains and mountains” of fraud in NFT and crypto as demand continues to grow in 2022.

A top special agent from the Internal Revenue Service told a conference that NFTs and cryptocurrencies are “the future” but emphasized that fraud and manipulation are still rampant in the space.

Ryan Korner from the IRS’s criminal investigation office in Los Angeles made comments on the virtual event hosted by USC Gould School of Law, Korner on Tuesday. Bloomberg reports Korner said:

“We just see mountains and mountains of fraud in this area.”

He told the event that the IRS CI department acknowledged the significant growth of the cryptocurrency sector, but noted that the use of digital assets is not limited to payments and transactions. He outlined various nefarious practices such as fraud, including money laundering, market manipulation and tax evasion.

Korner particularly emphasized market manipulation, pointing out that well-known investors have the ability to change asset prices with a single Tweet.

He talks about celebrity involvement in the space, perhaps thinking of examples like Kim Kardashian and Floyd Mayweather – who recently went viral for promoting a token scam called EthereumMax. Korner says:

“We’re not necessarily looking for celebrities, but when they make the blatant or public comment that says, ‘Hey, IRS, maybe you should come look at me,’ that’s what we do.”

‘This space is the future’

During the event, Korner stated the reason the department is actively training and educating its dealers on crypto regulation and NFTs, is that “this space is the future” and is going nowhere. chief.

Korner also claimed that the IRS has worked with other federal agencies, including the Department of Justice, to “make sure everyone is on the same page and staying ahead of the criminals,” he said.

Related: Overall impact of crypto crime set to decrease further in 2022: Chainalysis

IRS investigators seized $3.5 billion worth of cryptocurrency tied to financial crimes in fiscal year 2021. This represents 93% of the total assets the department seized in the timeframe. that time.

“IRS CI ended the year with 80 cases in its inventory that it is still actively working to find out where the major breach related to crypto,” Korner said.