US prosecutors are scrutinising the use of virtual currencies such as Bitcoin- which can be traded anonymously – amid fears that Americans are using them to evade taxes.
"Clearly the increasing use and misuse of cyber-based currency and payment systems to anonymously transfer illicit funds as well as hide unreported income from the IRS is a threat that we are vigorously responding to," Victor Lessoff of the Internal Revenue Service (IRS) told the Financial Times.
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Lessoff, the director of an IRS unit that investigates cyber threats, was expanding on remarks made at a conference run by New York University.
At the conference, Lessoff said that the globalisation and digitalisation of currencies is a significant emerging threat.
"It doesn’t take much of a leap [to think] that these currencies would be used for tax evasion," he added.
In future, taxpayers could be forced to disclose to the IRS whether they are using PayPal accounts for the virtual transfer of money, according to Lessoff.
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By GlobalDataThe targeting of virtual currencies follows an aggressive crackdown by the IRS and US Department of Justice on citizens who evade taxes by stashing money in offshore bank accounts.
Last month, prosecutors accused Costa Rican company Liberty of laundering US$6 billion over seven years for millions of customers who could make payments from anywhere in the world without proving who they were.
"We need to expand our efforts to catch cyber criminals as they’re doing the crime," Lessoff said.
The latest move to target tax evasion follows a landmark decision by Switzerland last month, which accepted a settlement over alleged bank complicity in evasion by Americans.
