Tax Authorities Unite to Target Cryptocurrency Crime

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Tax authorities in five major countries have come together with the formation of the Joint Chiefs of Global Tax Enforcement (J5) to fight against money laundering and international tax crimes conducted through the use of cryptocurrencies and offshore financial centres.

According to a press release from the J5, which comprises of tax enforcement authorities from the US, Canada, UK, Australia and the Netherlands, this joint operational alliance, will increase collaboration between these nations.

The alliance focuses on building international enforcement capacity by sharing information and intelligence, enhancing operational capability by piloting new approaches, and conducting joint operations to bring those who enable and facilitate offshore tax crime to account.

“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,” said Johanne Charbonneau, Director General, Canada Revenue Agency in the statement. “The J5 complements the important international work of the OECD 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.”

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According to a J5 statement on the IRS website, the alliance said it is convinced that “offshore structures and financial instruments, where used to commit tax crime and money laundering, are detrimental to the economic, fiscal, and social interests of our countries.”

The group said it will work together to: investigate those who enable transnational tax crime and money laundering and those who benefit from it; collaborate internationally to reduce the growing threat to tax administrations posed by cryptocurrencies and cybercrime and to make the most of data and technology.

The group was formed in response to a call to action from the OECD for countries to do more to tackle the enablers of tax crime and the J5 said it will share successes and findings from these joint efforts with the larger tax enforcement community.

At their first meeting last week, the J5 brought together leading experts in tax and other financial crimes, from each of the five member countries, to develop tactical plans and identify opportunities to pursue cyber criminals and enablers of transnational tax crime.

“We cannot continue to operate in the same ways we have in the past, siloing our information from the rest of the world while organized criminals and tax cheats manipulate the system and exploit vulnerabilities for their personal gain,” said Don Fort, Chief of IRS-Criminal Investigations. “The J5 aims to break down those walls, build upon individual best practices, and become an operational group that is forward-thinking and can pressurize the global criminal community in ways we could not achieve on our own.”

Further updates on J5 initiatives are expected in late 2018, the release states. Membership of the alliance includes the heads of tax crime and senior officials from the Australian Criminal Intelligence Commission (ACIC) and Australian Taxation Office (ATO), the Canada Revenue Agency (CRA), the Dutch Fiscal Information and Investigation Service (FIOD), Her Majesty’s Revenue & Customs (HMRC), and Internal Revenue Service Criminal Investigation (IRS-CI).

 

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