Roger Ver, ‘Bitcoin Jesus’, Nailed With Indictment by DOJ

NOIDA (CoinChapter.com)— The United States Department of Justice is seeking Roger Ver’s extradition from Spain following his recent indictment for mail fraud, tax evasion, and filing false tax returns.

Following Binance founder Changpeng “CZ” Zhao‘s sentencing, the legal action against Ver highlights the intensifying regulatory focus on the cryptocurrency industry, particularly concerning compliance with tax laws.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Martin Estrada for the Central District of California, underscored the severity of the charges. They noted that Ver’s actions resulted in an IRS loss of at least $48 million.

The IRS Criminal Investigation’s cybercrimes unit is investigating Ver’s case. Assistant Chief Matthew J. Kluge and Trial Attorney Peter J. Anthony of the Justice Department’s Tax Division and Assistant U.S. Attorney James C. Hughes for the Central District of California are prosecuting the case.

Ver, one of Bitcoin’s early adopters, is currently a supporter of Bitcoin Cash.

Allegations Against Ver

According to the DOJ press release, Roger Ver, formerly of Santa Clara, California, is known in the cryptocurrency community as “Bitcoin Jesus“. Ver allegedly engaged in a series of fraudulent activities involving his Bitcoin holdings and his businesses, MemoryDealers.com Inc. and Agilestar.com Inc. These companies sold computer and networking equipment and reportedly played a central role in Ver’s scheme to evade taxes.

In 2011, Ver began acquiring bitcoins both for his companies’ and personal use. He promoted the cryptocurrency while amassing a substantial portfolio.

By Feb. 4, 2014, when Ver obtained citizenship in St. Kitts and Nevis and renounced his U.S. citizenship—a process known as expatriation—he and his companies purportedly owned approximately 131,000 bitcoins.

At that time, bitcoins traded for around $871 each, with MemoryDealers and Agilestar holding about 73,000 tokens.

As part of the expatriation process, US law required Roger Ver to report capital gains from the constructive sale of his worldwide assets, including bitcoins, and to pay an “exit tax” on those gains.

However, the indictment alleges that Ver provided false information to the law firm and the appraiser tasked with preparing his expatriation-related tax returns. This lead to undervalued tax filings that omitted his personal Bitcoin assets.

Furthermore, by June 2017, Ver’s companies still possessed about 70,000 bitcoins. Around November 2017, Roger Ver allegedly sold tens of thousands of these bitcoins on cryptocurrency exchanges for approximately $240 million.

Despite no longer being a U.S. citizen, the law states that Ver had to report and pay taxes on distributions from his US corporations, MemoryDealers and Agilestar.

The indictment claims that Ver concealed these transactions from his accountant, resulting in a 2017 individual income tax return that failed to report any related gains or taxes.

Bitcoin Cash (BCH) Price Drops 13%

BCH’s price dropped over 13% since April 30 to reach a daily low near $408 on May 1. News of Zhao’s sentencing, and then Roger Ver’s indictment, is likely to have upset the market’s mood, forcing traders to exit their positions.

Should the downtrend continue, BCH price could drop to the support near $383. Moreover, breaching the immediate support might force the token to drop to the support near $333 before recovering.

However, if BCH price starts rallying, the token could rise to the resistance near $474. Moreover, breaking and consolidating above the immediate resistance might target the resistance near $534.

The relative strength index for BCH remained neutral, with a score of 33.44 on the daily charts.