A Ukrainian citizen has been sentenced to nine years in prison in what the IRS describes as the „first case of Bitcoin [with] a tax component“ in the United States.
A former Microsoft engineer has been sentenced to nine years for stealing more than $10 million in digital value from his former employer in the form of „stored value currency“ (CSV), including gift cards.
Volodymyr Kvashuk, a 26-year-old Ukrainian citizen residing in Washington, used his co-workers‘ accounts and identities to steal and then sell the CSV, giving the impression that his co-workers were responsible for the fraud. Kvashuk also used a Bitcoin blending service (BTC) to further obfuscate the paper trail and filed fraudulent tax returns.
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Brian Moran of the U.S. Attorney’s Office said:
„Stealing from your employer is bad enough, but stealing and making it look like your colleagues are to blame extends the damage beyond dollars and cents.
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Kvushuk was charged with 18 federal crimes, including six counts of money laundering and two counts of filing false tax returns. The Ukrainian used the stolen funds to buy a $1.6 million lakefront home and a $160,000 Tesla vehicle.
According to Internal Revenue Service Special Agent Ryan Korner, the ruling is „the first Bitcoin case in the nation to have a tax component.
„In short, today’s ruling shows that you can’t steal money over the Internet and you believe Bitcoin will hide its criminal behavior.
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Kvashuk worked at Microsoft from August 2016 until his dismissal in June 2018.
The peak comes after a sharp decrease in hash power in late October, which many analysts attributed to the end of the rainy season in the Chinese mining center of Sichuan.
It is estimated that the province’s abundant and cheap hydroelectric power attracts about 80% of Chinese miners during the wet season. In December, CoinShares estimated that Sichuan accounted for 54% of global mining activity.