The United States and four other countries are launching a tax enforcement alliance to tackle the threat” of crypto-related cybercrime, according to a press release published earlier this week.
According to the United States Internal Revenue Service at IRS.gov, the organization has launched an international task force in partnership with Australia, Canada, the Netherlands, and the United Kingdom. The coalition will be called “The Joint Chiefs of Global Tax Enforcement”, which will be labeled under the catchier name of J5.
Agencies from each of the five coalition countries will cooperate on intelligence and criminal investigations “to reduce the growing threat to tax administrations posed by cryptocurrencies and cybercrime,” explains the IRS in a press release.
The press release also mentions the growing threat of transnational tax crime and money laundering.
According to the IRS, the five countries were motivated to launch their own tax enforcement alliance after OECD called member countries to increase their efforts against tax crimes perpetrated using cryptocurrencies. The Organization for Economic Co-operation and Development (OECD) is an intergovernmental organization with 35 member countries dedicated to stimulating economic progress and world trade. Tax crimes facilitated by cryptocurrencies are obviously a threat to economic progress and world trade, so it makes sense that the OECD would implore members to combat cryptocurrency-related tax crime.
According to Don Fort, chief of the IRS’s Criminal Investigations division, J5 “can pressurize the global criminal community in ways we could not achieve on our own.” The multilateral effort is expected to reduce cryptocurrency-related tax crime worldwide.
This isn’t the first time the IRS’s Criminal Investigations (IRS-CI) division has got involved with cryptocurrencies. Back in February, the IRS-CI assembled a team of 10 new investigators to increase its investigations into those who use cryptocurrencies to evade taxes.
The IRS has also partnered with the US Department of Justice (DOJ) and the FBI in crypto-related criminal cases. Earlier this year, for example, the pair investigated cryptocurrency use on Backpage.com. The site was charged with laundering half a billion dollars in illegal revenue, with part of that revenue coming from cryptocurrencies.
Meanwhile, the IRS has been reportedly using tools like Chainalysis to track crypto-related activity as far back as 2017.
Based on all of their previous efforts, it should be no surprise that the IRS continues to pursue those who use cryptocurrencies for tax evasion. The latest initiative called The Joint Chiefs of Global Tax Enforcement (J5) is a continuation of that effort in partnership with some of the world’s other leading economies.