The Internal Revenue Service (IRS) says the conviction of a former Microsoft engineer who tried to use Bitcoin to hide nefarious activities shows crypto assets can’t hide criminal behavior.
US district judge James L. Robart sentenced Volodymyr Kvashuk, a Ukrainian citizen residing in Renton, Washington, to nine years in prison on Monday.
Prosecutors say Kvashuk stole millions of dollars in online gift cards and other forms of currency stored value (CSV) while testing Microsoft’s online retail sales platform between 2016 and 2018.
Investigators say he tried to make it look like his co-workers were behind the theft and used a Bitcoin mixing service in an effort to try to scramble and hide the source of the funds before ultimately sending them to his bank account. According to the IRS, Kvashuk then filed fake tax return forms claiming he had received the BTC as a gift.
Internal Revenue Service Criminal Investigation (IRS-CI) special agent in charge, Ryan L. Korner, says the prosecution shows Bitcoin is not an effective tool for ciminals.
“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.”
The IRS calls the successful prosecution the nation’s first Bitcoin case that has a tax component to it.
Kvashuk was ordered to pay $8,344,586 in restitution and may be deported following his term in prison.
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/Sergey Nivens
