Roger Ver, widely recognized for his early investments in Bitcoin and often referred to as “Bitcoin Jesus,” has been indicted on charges including mail fraud, tax evasion, and submitting false tax returns. Ver was apprehended over the weekend in Spain, following the unsealing of the indictment in the United States, which is now seeking his extradition for trial.
Ver, originally from Santa Clara, California, was the owner of MemoryDealers.com Inc. and Agilestar.com Inc., companies involved in the sale of computer and networking hardware. Reports suggest that starting in 2011, Ver began accumulating bitcoins both personally and for his businesses, while also becoming a vocal advocate for the cryptocurrency, earning him his nickname.
The indictment details that on February 4, 2014, Ver acquired citizenship in St. Kitts and Nevis and subsequently renounced his U.S. citizenship, a process known as expatriation. Following this change, Ver was allegedly obligated to file tax returns in the U.S. that declared capital gains from the deemed sale of his global assets, including bitcoins, and to pay an “exit tax” on those gains. At the time of his expatriation, Ver and his companies reportedly possessed around 131,000 bitcoins, valued at approximately $871 each, with MemoryDealers and Agilestar holding about 73,000 of these.
It is alleged that Ver enlisted a law firm to aid with his expatriation and the preparation of related tax returns, as well as an appraiser to evaluate his companies. However, he is accused of providing false or misleading information that understated the number of bitcoins owned, leading to the filing of inaccurate tax returns that significantly undervalued his companies and their bitcoin holdings, and failed to disclose his personal bitcoin ownership.
By June 2017, it is claimed that Ver’s companies still held about 70,000 bitcoins, which he took control of and sold in November 2017 for roughly $240 million. Despite no longer being a U.S. citizen, Ver was required to report and pay taxes on certain distributions from MemoryDealers and Agilestar, both U.S. corporations. He allegedly concealed this transaction from his accountant, resulting in his 2017 tax return omitting any gains or taxes related to the sale of the bitcoins.
The total loss to the IRS attributed to Ver’s actions is estimated to be at least $48 million.
The case is currently under investigation by the IRS Criminal Investigation’s cybercrimes unit, with the Justice Department’s Tax Division and the U.S. Attorney’s Office for the Central District of California leading the prosecution.
