International Tax Authorities Form J5 To Fight Crypto Crimes


Five tax authorities from different countries, including the US, have teamed up to combat international and transnational tax crimes, including those involving cryptocurrencies.

On Monday, Internal Revenue Service Criminal Investigation (IRS-CI) announced the formation of its tax enforcement supergroup, the Joint Chiefs of Global Tax Enforcement (or the J5 for short). The J5 features tax authorities from the United States, the United Kingdom, Canada, Australia, and the Netherlands.

Specifically, the J5 is comprised of senior tax officials and heads of tax crime from the Internal Revenue Service Criminal Investigation (IRS-CI), Her Majesty’s Revenue & Customs, the Canada Revenue Agency (CRA), the Australian Criminal Intelligence Commission and Australian Taxation Office (ACIC), and the Dutch Fiscal Information and Investigation Service (FIOD).

The alliance hopes to develop the capacity to enforce tax guidelines across borders, improve operations, and hold offshore tax criminals accountable for their actions. The J5 intends to achieve all this through information sharing, pilot programs, and joint criminal investigations.

Members from the J5 specifically expressed concern about cybercrime involving cryptocurrencies. Johanne Charbonneau, Director General of the CRA, noted:

“The formation of the J5 demonstrates the serious commitment of governments around the globe in enhancing international cooperation in fighting serious international tax and financial crimes, money laundering, and cybercrime through the use of cryptocurrencies. The J5 complements the important international work of the OECD [Organisation for Economic Co-operation and Development] through operational collaboration. Our collective efforts and experience will be shared to jointly identify and address the increasingly sophisticated and global schemes and the professional enablers that facilitate such schemes.”

Hans van der Vlist, General Director of the FIOD, echoed Charbonneau’s sentiment:

“The unique thing about the J5 is the operational collaboration between five countries on tackling professional enablers that facilitate offshore tax crime, cybercrime and the threat of cryptocurrencies to tax administrations, as well as making best use of internationally available data and technology.”

The J5 met for the first time last week in Montreal, where the group discussed opportunities and tactics to pursue cybercriminals. Although specific plans have not been released, the alliance expects to reveal updates on J5 initiatives in late 2018.

The IRS is no stranger to crypto crime. In fact, the agency signed a $124,000 deal with the anti-money laundering software company Chainalysis to investigate cryptocurrency tax evasion, starting in September 2017. The IRS’ concerns may be warranted considering that cryptocurrency-related tax liabilities for the 2017 tax year were estimated at $25 billion.

With the announcement of J5’s formation, it appears that the IRS, with the support of international tax authorities, is continuing its foray into the realm of crypto crimefighting.

Daniel Putney is a full-time writer for ETHNews. He received his bachelor’s degree in English writing from the University of Nevada, Reno, where he also studied journalism and queer theory. In his free time, he writes poetry, plays the piano, and fangirls over fictional characters. He lives with his partner, three dogs, and two cats in the middle of nowhere, Nevada.

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