Frank Richard Ahlgren III, a Bitcoin investor from Austin, Texas, has been sentenced to two years in prison for tax evasion related to his $1 million in cryptocurrency profits. Ahlgren, who began buying Bitcoin in 2011, employed deceptive methods like using digital mixers and multiple wallets to hide his transactions, but the IRS was able to track his activities.
Ahlgren’s scheme started in 2015 when he bought 1,366 Bitcoin and later sold 640 BTC in 2017 for $3.7 million, failing to report his profits. He also submitted false tax returns, inflating the purchase price of his Bitcoin. In 2018 and 2019, he concealed over $650,000 in additional earnings.
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This case marks the first criminal tax evasion conviction in the US solely based on cryptocurrency transactions. The IRS has ramped up efforts to crack down on crypto-related tax evasion through initiatives like “Operation Hidden Treasure.”
Lucy Tan, Acting Special Agent in Charge of IRS Criminal Investigation, emphasized that no one, regardless of their crypto knowledge, is above the law.
