Roger Ver Faces IRS Wrath: US Govt Sending a Message?

Roger Ver’s arrest over alleged $48M tax evasion fuels discussion on government overreach and ethics of taxation.

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  • Roger Ver is arrested on allegations of tax evasion.
  • Some observers believe US authoritiesactions are unjustified. 
  • The incident has triggered debate on the morality of taxation.

Roger Ver was an early adopter and evangelist of Bitcoin, amassing a vast fortune by believing in the digital currency at a time when most dismissed it as worthless “magical internet money.” 

Ver acquired St. Kitts and Nevis citizenship in 2014 and renounced his US citizenship shortly after. Although Ver thought he was free of US control, authorities arrested the Bitcoin Cash proponent over the weekend on mail fraud and tax evasion charges, stoking government overreach concerns.

DoJ Coming For Roger Ver

Roger Ver was arrested in Spain over the weekend on charges of mail fraud and tax evasion. The Department of Justice (DoJ) is seeking Ver’s extradition to the US to stand trial over the charges, particularly unpaid taxes totaling $48 million. Ver’s lawyer, Bryan Skarlatos, stated that his client had relied on tax professionals to report his Bitcoin holdings properly and always intended to comply with regulations.

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The outstanding tax liabilities stem from Ver’s 2014 renunciation of his US citizenship. Under citizen renunciation, individuals are required to pay an exit tax, with assets held treated as being sold at fair market value and any subsequent gains subject to an “expatriation tax.” The DoJ alleged that Ver and two of his companies, MemoryDealers.com and Agilestar.com, held around 131,000 BTC at that time.

In this case, prosecutors claimed Ver provided misleading information to undervalue his companies’ Bitcoin holdings when preparing the expatriation filings. The indictment claimed that in November 2017, Ver took possession of 70,000 BTC from his companies and sold them for around $240 million but failed to pay taxes owed on those distributions.

The DoJ stated that although Ver was not a US citizen when cashing out the 70,000 BTC, he was still legally required to report distributions from his companies and pay taxes on the sale of the BTC.  

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Given the spate of perceived attacks on the crypto industry by US authorities lately, some have labeled Ver’s arrest as an unjustified overreach on the part of the US government. 

Crypto Clampdown?

Several observers labeled Ver’s arrest a massive overreach by the US government. Simply Bitcoin host Nico tied this incident to the recent arrest of Samourai Wallet devs, stating that the two events equate to the government “sending a message” to the cryptocurrency community.

Kurt Wuckert Jr., the founder of BSV miner Gorilla Pool, dived into a philosophical point on the morality of taxation itself, commenting that “Failure to bribe the government so they don’t put you in a cage is not a crime. Demanding the bribe is evil.” Likewise, podcaster “Walker” stated that “The United States of America holds its citizens prisoner.”

Input Output CEO Charles Hoskinson took a different view by addressing the charges against Ver. Hoskinson noted that Ver’s two companies were US-based, meaning Ver still had a tax obligation to the US even though he had renounced his US citizenship. Nonetheless, Hoskinson hoped that the allegations against Ver would be proven false.

On the Flipside

  • The MemoryDealers.com URL diverts to a tweet from Ver expressing distrust of the US government
  • Servicing the US national debt is expected to cost $531 billion in 2024, making it the fifth largest government spending program.

Why This Matters

Some maintain that taxation is theft, but the reality is that tax is the price to pay for living in a civilized society. However, the timing of Ver’s arrest is somewhat puzzling, given that the allegations occurred nearly seven years ago.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Samuel Wan

Samuel Wan is a finance professional turned crypto journalist, known for his insightful reporting on market trends, regulatory changes, and technological developments within the digital asset industry. His ability to simplify complex concepts and report the facts has made him a trusted source in the crypto community. Beyond his writing, Samuel is an active mountain biker and gamer.