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Joint Chiefs of Global Tax Enforcement Report on Progress Identifying Massive Global Tax Cheats

by | Jul 14, 2020 | International Tax Law, OVDP, Tax Crimes |

It has been two years since international tax leaders from Australia, Canada, the Netherlands, the United Kingdom, and the United States joined forces in the “J5” to combine resources to target enablers of tax crime, particularly related to virtual currency.

Since its 2018 inception, the J5 has focused on the more sophisticated means used by criminals to conceal their bad acts, and discovered new ways to detect and thwart these activities globally through the use of data scientists, technology experts, cryptocurrency experts, and investigators.  Two J5 countries have hosted events known as “Challenges” for the purposes of developing operational collaboration.

Recently, a Romanian man was arrested in Germany who admitted to conspiring to engage in wire fraud and offering and selling unregistered securities in connection with his role in the BitClub Network, a cryptocurrency mining scheme worth at least $722 million. This plea was the first for a case under the J5 umbrella.  Many more are expected to follow.

“The value of the Challenges cannot be overstated,” said Don Fort, Chief, IRS Criminal Investigation. “When you take some of the smartest people from each organization and put them in a room for a few days, the results are truly impressive.  Each country found investigative leads and was able to further cases utilizing tools and techniques created by each country’s experts specifically for the Challenge. I see us doing more of these events in the future.”

Last year, the United States and the World Bank hosted cyber training in Washington, DC bringing together more than 120 international and domestic law enforcement partners from approximately 20 countries to address emerging areas associated with cybercrime, virtual currency, blockchain and the dark web. Additionally, to ensure J5 countries were using all law enforcement and legal tools available during their collaborative work, trainings were held in Sydney and the Netherlands on international elements of the UK corporate criminal offense legislation and prosecution opportunities to lawyers and public prosecutors.

After two years of collaboration, data sharing, and accelerated casework, the J5 began seeing operational results in early 2020. J5 countries participated in a globally coordinated day of action to put a stop to the suspected facilitation of offshore tax evasion. The action was part of a series of investigations in multiple countries into an international financial institution located in Central America, whose products and services are believed to be facilitating money laundering and tax evasion for customers across the globe. Evidence, intelligence, and information collection activities such as search warrants, interviews and subpoenas were undertaken in each country and significant information was obtained and shared as a result. That investigation is ongoing.

The J5 includes the Australian Taxation Office (ATO), the Canadian Revenue Agency (CRA), the Dutch Fiscal Information and Investigation Service (FIOD), Her Majesty’s Revenue and Customs (HMRC) from the UK, and the Internal Revenue Service Criminal Investigation Division (IRS-CI) from the US.

For more information about J5, please visit www.irs.gov/J5.


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