Tax authorities around the globe have focused on combatting tax evasion and other financial crimes associated with cryptocurrency in recent years. More recently, investigative efforts have broadened to include the FinTech industry. In late March 2021, the Joint Chiefs of Tax Enforcement—or the J5—held a coordinated international tax investigation into the FinTech industry and cryptocurrency. As reported in an earlier post, the J5 is a consortium of the taxing authorities of Australia, Canada, the Netherlands, the U.K. and the U.S. formed in 2018 to leverage the agencies’ collective resources to root out financial crimes. The group has held an annual event (dubbed “The Challenge”) in each of the last four years that focused on generating investigative leads, including with respect to tax evasion committed in connection with cryptocurrency. Past Challenges have resulted in measurable results, including an arrest associated with a cryptocurrency mining scheme.
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