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IRS Now Chasing BitCoin Users

Discussion in 'BlackHat Lounge' started by The Scarlet Pimp, Dec 11, 2016.

  1. The Scarlet Pimp

    The Scarlet Pimp Senior Member

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    Imagine if you found out that the IRS had just issued a summons for every financial transaction by every customer of your bank for the last two years, just to see if they had maybe committed some form of tax fraud, and that a federal judge had approved that request.

    Last week, that is exactly what happened to the bitcoin exchange, Coinbase. Under the guise of ferreting out people committing tax fraud, the IRS, via the DOJ, filed a "John Doe' summons requesting every financial transaction that has occurred on Coinbase between 2013 and 2015.

    The IRS has audited taxpayers who failed to report bitcoin income and were Coinbase users, but there is no indication that fraud has been committed on a mass scale by Coinbase's users. A federal judge granted the IRS the authorization to collect millions of records, nonetheless.

    According to a Forbes article, the head of the Justice Department's Tax Division, Principal Deputy Assistant Attorney General Caroline D. Ciraolo, explained the filing as addressing the concerns mentioned above:

    “As the use of virtual currencies has grown exponentially, some have raised questions about tax compliance. Tools like the John Doe summons authorized today send the clear message to U.S. taxpayers that whatever form of currency they use – bitcoin or traditional dollars and cents – we will work to ensure that they are fully reporting their income and paying their fair share of taxes.”

    In short, the DOJ and IRS are using a brute force technique to tell bitcoin users, without reasonable suspicion of wrongdoing, that they can run but they can't hide.

    ---

    Court Grants IRS Authority To Demand Identities Of Bitcoin Users At Coinbase

    That was the ruling today out of a federal court in the Northern District of California authorizing the Internal Revenue Service (IRS) to serve a "John Doe" summons on Coinbase requesting the identities of United States Coinbase customers who transferred convertible virtual currency from 2013 to 2015. Coinbase, which is headquartered in San Francisco, California, is a company which facilitates transactions of digital currencies like Bitcoin and Ethereum.

    The Department of Justice (DOJ) had made the request earlier this month (California Northern District Court, Case No. 3:16-cv-06658-JSC) on behalf of the IRS since a "John Doe" summons can only be served by the IRS with federal court approval. A "John Doe" summons is an order that does not specifically identify the person but rather identifies a person or ascertainable group or class by their activities. In the past, that's included investors in a particular tax shelter or account holders at a defined financial institution: the IRS has made use of the procedure, for example, when seeking information about offshore accounts those related to the UBS investigation.

    In granting the motion, Judge Jacqueline Scott Corley found that "ased upon a review of the Petition and supporting documents, the Court has determined that the “John Doe” summons to Coinbase, Inc. relates to the investigation of an ascertainable group or class of persons, that there is a reasonable basis for believing that such group or class of persons has failed or may have failed to comply with any provision of any internal revenue laws, and that the information sought to be obtained from the examination of the records or testimony (and the identities of the persons with respect to whose liability the summons is issued) are not readily available from other sources."

    http://www.forbes.com/sites/kellyph...-users-transactions-at-coinbase/#420e61a42fd8
     
  2. Reaver

    Reaver Jr. VIP Jr. VIP

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    Smh that is a damn shame.
     
  3. AceWallGromit

    AceWallGromit Regular Member

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    I guess I'm stupid but I thought bitcoins were anonymously sent and recieved?
     
  4. asap1

    asap1 BANNED BANNED Jr. VIP

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    They sure did rule on this case mighty quick while everything else takes months or even years to move through the system.

    Oh its the IRS no wonder, its all a damn scam. This is why JFK was killed, he tried to stop this mess.
     
    Last edited: Dec 12, 2016
  5. Capo Dei Capi

    Capo Dei Capi BANNED BANNED

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    How is the IRS a "scam" they just collect tax revenue that is needed for the government to function.
     
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  6. Reaver

    Reaver Jr. VIP Jr. VIP

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    The US courts can compel any company that operates in the US to give up info on their customers. No Bitcoin transaction that goes through a US based company, like Coinbase, is anonymous.

    These companies have all your info including address, credit cards and bank accounts. I know bc I have a Coinbase account. Fortunately I never recieved payments to my wallet. I only sent them. So I'm good.
     
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  7. The Scarlet Pimp

    The Scarlet Pimp Senior Member

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    this is from "private internet access"...

    How to Buy Bitcoins Anonymously in the US, Instantly

    If CISPA or other privacy-busting legislations pass, every detail of our personal lives will be at risk. Although many of our foundations are rooted in anonymity, everything we see, do and buy may soon be exposed. However, technology always evolves, and anonymity is no exception.

    As many already know, Bitcoin is a decentralized, digital currency that can be used like cash. What many people may not already know, however, is that there is no need to hand over all of your information to an exchange to buy bitcoins. It's already incredibly easy to buy bitcoins anonymously, in less than 10 minutes!

    An anonymous member of the Bitcoin community has contributed these wonderful instructions detailing 6 simple steps to buying Bitcoins with near anonymity in the US.

    • • •

    Step 1.
    Download and install TOR from https://www.torproject.org/

    Step 2.
    While using TOR create a Tormail account at http://jhiwjjlqpyawmpjx.onion
    You can confirm the address at http://tormail.org/

    Step 3.
    While using TOR, visit http://www.bitinstant.com

    Step 4.
    Choose the "Cash bank deposit" to "Bitcoin to email" option.

    Step 5.
    Follow the instructions on Bitinstant to make your cash deposit, and have your Bitcoins sent to your new Tormail account. No ID is needed.

    Step 6.
    Receive your Bitcoins via email.

    And voila. Now you can use your anonymous e-mail account and anonymous bitcoins to buy goods and services online, truly anonymously.

    Here are a few places you can spend Bitcoins:

    1. Private Internet Access – Anonymous VPN Service
    https://www.privateinternetaccess.com

    2. MemoryDealers – Transceivers, Cables, and Memory
    http://www.memorydealers.com

    3. CoinDL – The iTunes of the Bitcoin economy
    http://www.coindl.com

    4. Seals With Clubs – Poker (Hold'em)
    https://sealswithclubs.eu

    5. BitcoinDeals – The Amazon of the Bitcoin economy
    http://www.bitcoindeals.com

    A quick search of the interweb will also display the thousands upon thousands of other shops that accept Bitcoins.

    https://www.privateinternetaccess.c...buy-bitcoins-anonymously-in-the-us-instantly/
     
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  8. Reaver

    Reaver Jr. VIP Jr. VIP

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    The comments section is quite enlightening. Apparently this method isn't as anonymous as people think it is.

     
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  9. umerjutt00

    umerjutt00 Jr. VIP Jr. VIP

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  10. The Scarlet Pimp

    The Scarlet Pimp Senior Member

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    a very good reason not to use any usa-based vpn service, like p.i.a.
     
  11. The Scarlet Pimp

    The Scarlet Pimp Senior Member

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    google, "war on cash" :(
     
  12. royserpa

    royserpa Jr. VIP Jr. VIP Premium Member

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