An early Bitcoin investor who made millions of dollars acquiring the cryptocurrency and later dubbed himself “Bitcoin Jesus” has been arrested on fraud charges.
Roger Keith Barr, 45, was arrested in Spain over the weekend. He previously lived in Santa Clara, California, but until recently he lived in Tokyo.
According to the U.S. Department of Justice, Barr is facing three counts of mail fraud, two counts of tax evasion and three counts of filing a false tax return.
The Justice Department says it will seek Barr's extradition to the United States to face charges.
Barr was an early adopter of Bitcoin, acquiring hundreds of coins through two businesses selling computers and networking equipment he owned. He heavily promoted the cryptocurrency online, which led him to later adopt the nickname “Bitcoin Jesus,” the Justice Department said.
In February 2014, Ver became a citizen of the Caribbean island of St. Kitts and renounced his U.S. citizenship. This is a procedure called deportation. As part of that process, he was required under federal law to file tax returns reporting capital gains from the sale of assets around the world, including Bitcoin, and to report the fair market value of the assets.
He also had to pay a tax on these capital gains, known as an “exit tax”, as part of his emigration.
According to the Department of Justice, Ver and his company owned approximately 131,000 Bitcoins in total, trading on several major cryptocurrency exchanges at a price of approximately $871 each. The two Ver companies are said to have held approximately 73,000 of these coins.
Authorities said Barr hired a law firm to help him move abroad and prepare related tax documents. He hired appraisers to value his two companies, but provided false or misleading information to hide the amount of virtual currency he and his companies actually owned. It is said that he did.
As a result of his alleged fraud, a law firm prepared his tax documents and significantly undervalued the two companies and their 73,000 Bitcoins. Ver himself reported that he does not personally own any Bitcoin.
His indictment alleges that by June 2017, Ver's two companies continued to own the entirety of approximately 70,000 Bitcoins. According to the Justice Department, the suspect transferred the bitcoins to himself in November and then sold tens of thousands of them on cryptocurrency exchanges, netting about $240 million in profits. According to Statmuse, Bitcoin's average closing price in November 2017 was over $7,800.
Although Mr. Barr was no longer a U.S. citizen, his two companies were U.S. corporations, so he was legally required to report these transactions to the IRS and pay taxes on certain distributions. .
The Justice Department alleges that Barr hid information about his Bitcoin transfers and sales from his accountant and failed to report profits or pay taxes related to the transactions on his 2017 personal tax return.
Authorities allege Ver caused at least $48 million in losses to the IRS.
If convicted on all charges, Barr faces up to 20 years in federal prison for each mail fraud charge, up to five years in federal prison for each tax evasion charge, and up to three years in federal prison for each subscription charge. will be punished. False tax returns.
This case remains under investigation by the IRS.
A 2014 profile in Bloomberg details Barr's efforts to attract more affluent crypto investors to St. Kitts residents, boasting that St. Kitts has no taxes on personal income or capital gains. ing.
For those interested, one Bitcoin is currently worth over $60,000.
