A top special agent for the Internal Revenue Service told a conference call that NFTs and crypto are the “future,” but highlighted that fraud and manipulation are still rampant in the space.
Ryan Korner of the Los Angeles Field Office of the IRS Criminal Investigation commented on the virtual event hosted by the USC Gould School of Law, Korner on Tuesday. Bloomberg reports Korner said:
“We’re only seeing mountains and mountains of deceit in this area.”
He told the event that the IRS CI division acknowledges the significant developments in the crypto sector, but noted that the use of digital assets is not limited to payments and trading. He outlined various illegal practices such as fraud, including money laundering, market manipulation and tax evasion.
Korner specifically highlighted market manipulation that has the potential to influence asset prices with a single tweet pointing at high-profile investors.
He talked about the involvement of celebrities in the space, perhaps thinking of the examples of Kim Kardashian and Floyd Mayweather – who recently allegedly fraudulently coined a token dubbed EthereumMAX. Korner said:
“We’re not necessarily looking for celebrities, but when they make a candid or open comment that says ‘Hey, IRS, you should probably see me,’ that’s what we do.”
‘This place is the future’
During the incident, Körner said that the division was actively training and educating its agents on crypto and NFT regulation, as “this space is the future” and was not going anywhere.
Korner also noted that the IRS has collaborated with other federal agencies, including the Justice Department, “to make sure everyone is on the same page and ahead of criminals,” he said.
related: The overall impact of crypto crime is likely to shrink even further in 2022: Chainalysis
IRS investigators seized $3.5 billion in cryptocurrency linked to financial crimes during fiscal year 2021. This accounted for 93% of all assets confiscated by the division in that time frame.
“IRS CI ended the year with 80 cases on its list that it was still actively working on where the primary breach was related to crypto,” Korner said.
