A former Microsoft employee was charged with the first-ever bitcoin tax fraud in the United States as we are reading more about it in the latest bitcoin scams news.
Volodymyr Kvashuk was handed a nine-year sentence for 18 felonies like fraud and money laundering. The Ukrainian engineer defrauded Microsoft out of $10 million by using Bitcoin to hide the funds. the Ukrainian software engineer was sentenced to nine years in prison for defrauding the company during his tenure at the company. Kvashuk stole about $10 million and transferred $2.8 million value to his bank accounts via a BTC mixing service. The case is the first known US Example of false tax reports that involve bitcoin as the benchmark cryptocurrency.
The former Microsoft employee has been sentenced to nine years in prison after defrauding Microsoft of more than $10 million as he was transferring funds into BTC as a part of the elaborate ploy. Over the period of seven months during his time at Microsoft, he stole millions of dollars in cryptocurrency stored value which is a term often used to refer to assets like digital gift cards. Residing in Renton, Washington, he was charged at a US District Court yesterday for 18 felonies like various counts of fraud, identity theft, money laundering, and filing false tax returns.
Kvashuk’s crimes involved stealing Microsoft gift cards and reselling them via online marketplaces. He took about $12,000 initially before raising the stakes to steal millions. The 26-year old was found to have used test email accounts of his co-workers and covered his tracks. Once he committed the crimes, he purchased luxurious houses and a Tesla car. After the conviction, Kvashuk was given a nine-year sentence yesterday and ordered to pay $8,344,586 in damages. He will likely be deported from the USA.
Kvashuk’s case drew attention to his use of BTC in an attempt to conceal his activity. He transferred $2.8 million in BTC into his bank and investment accounts using a tumbler service to hide his trails of transactions. Due to Bitcoin’s blockchain registering every transaction on the ledger, mixing service such as CryptoMixer as the popular tool among those that want to maintain privacy on the network. Kvashuk evaded taxes on BTC funds claiming that he received the currency from a family member. It’s the first known tax fraud involving Bitcoin in the USA. Speaking o the trial, IRS Special Agent Ryan Korner said:
“Kvashuk’s criminal acts of stealing from Microsoft, and subsequent filing false tax returns, is the nation’s first Bitcoin case that has a tax component to it. Simply put, today’s sentencing proves you cannot steal money via the Internet and think that Bitcoin is going to hide your criminal behaviors. Our complex team of cybercrimes experts with the assistance of IRS-CI’s Cyber Crimes Unit will hunt you down and hold you accountable for your wrongdoings.”
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