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A Bitcoin investor has been ordered to disclose his secret pass codes so his digital assets can be unlocked by US officials, with the amount totalling about $124 million.
The US District Judge Robert Pitman ruled on Monday (January 6) that Frank Richard Ahlgren III must hand over the codes and identify any devices used to store them. He was also ordered to disclose his cryptocurrency accounts.
The investor was the first American to be convicted of tax crimes tied to the sale of cryptoassets and he has agreed to pay $1 million in restitution to the US. This payment is to cover the tax losses from underreporting capital gains on the sale of $3.7 million of Bitcoin.
It’s not just the access into the wallets though, as the investor and any associates are prohibited from transferring or hiding any digital assets without court approval. They can, however, use funds for ‘normal monthly living expenses.’
Bitcoin investor pleaded guilty
This comes after Ahlgren pleaded guilty on September 12 and was later sentenced on December 12. The man, who lives in Austin, will comply with the recent order according to his attorney.
It was in December when prosecutors had asked the judge to force Ahlgren to share the location of at least 1,287 Bitcoin he moved in 2020 through a ‘mixing’ service. The tokens have since doubled in value, with the sum amounting to more than $124 million.
Ahlgren was sentenced on December 12 to two years in prison, with the U.S. Department of Justice sharing the details in a press release at the time.
“Ahlgren will serve time because he believed his cryptocurrency transactions were untraceable. This case demonstrates that no one is above the law.
“My team at IRS Criminal Investigation has the expertise and tools to track financial activity, whether it involves dollars, pesos, or cryptocurrency,” said Acting Special Agent in Charge Lucy Tan of IRS-Criminal Investigation (IRS-CI)’s Houston Field Office in the press release from December.
“This case marks the first criminal tax evasion prosecution centered solely on cryptocurrency. As the prices for cryptocurrency are high, so is the temptation to not pay taxes on its sale. Avoid the temptation and avoid federal prison.”
Featured Image: AI-generated via Ideogram
