Roger Ver Arrested: What Sentence Could “Bitcoin Jesus” Expect?

Key Takeaways

• US authorities arrested Bitcoin pioneer Roger Ver for allegedly hiding millions in BTC holdings and evading millions in taxes.
• The DOJ suspects Ver of providing false information to tax professionals and attempting to move assets to avoid taxes.
• Ver’s legal history and the recent lenient sentence for CZ raise questions about the potential severity of his punishment.
• If Ver is both charged and found guilty, he could be jailed for anywhere between two months and 30 years.

United States authorities have apprehended former Bitcoin.com CEO Roger Ver on accusations of mail fraud, tax evasion, and filing false tax returns. This effectively brings him under the control of the country whose citizenship he previously renounced.

On April 30, the Department of Justice announced  that Ver had been arrested in Spain over the past weekend and would face extradition proceedings.

If Ver is both charged and found guilty, he could be jailed between anywhere between two months and 30 years.

Roger Ver: Bitcoin Advocate, BJJ Enthusiast, and Controversial Figure

Roger Ver is an influential figure in the cryptocurrency world, often dubbed “Bitcoin Jesus”  for his early and fervent BTC promotion He was an early investor in Bitcoin and related startups. Over time, Ver has shifted his focus to Bitcoin Cash (BCH), which he advocates for as a true continuation of the vision outlined in Satoshi Nakamoto’s 2008 Bitcoin White Paper , describing Bitcoin as a peer-to-peer electronic cash system.

Originally from Silicon Valley, Ver’s early entrepreneurial activities included selling fireworks on eBay, which led to a felony charge and a subsequent ten-month prison sentence. In 2005, he moved to Japan and in 2014, he renounced his United States citizenship after acquiring a passport from Saint Kitts & Nevis. He has also served as the CEO of Bitcoin.com.

Apart from his contributions to the cryptocurrency sector, Ver is passionate about Brazilian jiu-jitsu. He competes in BJJ world championships, and he has achieved a brown belt in the sport. His influence and contributions to the intersection of finance and technology earned him a spot in Fortune’s “The Ledger 40 under 40” in 2018, where he was ranked number 36.

Roger Ver Indicted for $48 Million Tax Evasion

An indictment against Ver  was unsealed by the DoJ. The deparment outlined his evasion of “at least” $48 million in taxes owed to Uncle Sam. The IRS Criminal Investigation cybercrimes unit helped the DOJ investigate Ver.

The investigation primarily focuses on Ver’s acquisition of thousands of BTC tokens starting in 2011. This was conducted through two California-based companies controlled by him: MemoryDealers.com Inc. and Agilestar.com Inc. Accounts under these companies were opened at digital asset exchanges such as Mt Gox and BitStamp.

In February 2014, around the time Roger Ver renounced his American citizenship . He obtained citizenship from Saint Kitts & Nevis, whilemhis two companies held approximately 73,000 of his total 131,000 BTC tokens.

American law mandates that anyone renouncing their citizenship must file tax returns that reflect the capital gains from a constructive sale of all worldwide assets, and report the fair market value of those assets. To comply, Ver enlisted the help of a law firm and hired two appraisers to assess the value of his two companies.

However, the DOJ claims Ver provided false or misleading information to both the law firm and the appraisers about the number of BTC he and his companies actually controlled. For example, in April 2013, he reportedly told one of the appraisers  that he controlled only 25,000 BTC, whereas he actually had 117,000 BTC.

Ver’s Defense Crumbles as Millions in Sales Revealed

Roger Ver repeatedly clashed with the tax preparers from his law firm. They insisted that he owed millions in taxes, a claim Ver labeled as “impossible and unreasonable”. He also argued BTC wallets were neither registered under any specific names nor tied to a tax ID. This, therefore, meant they were beyond the reach of the IRS, which could neither freeze nor seize the tokens.

In some cases, Ver outright refused to disclose the size of his BTC holdings to his law firm’s tax preparers. He also considered the tax implications of transferring all his BTC to his partner in Japan, who was not legally his wife. This led to his law firm filing a tax form in 2016 that falsely claimed Ver had gifted 25,000 BTC to his partner on November 15, 2011, a document Ver signed himself.

As a result, the tax returns filed by Ver substantially undervalued his two companies and their 73,000 BTC. They also failed to report any personal BTC holdings.

Roger Ver “sold tens of thousands of Bitcoin”: DOJ

According to the indictment, Ver’s two companies still possessed about 70,000 BTC as of June 2017, at which point Ver took personal possession of them. In November of the same year, he sold “tens of thousands” of these tokens for approximately $240 million through exchanges such as Kraken, Bitfinex, Bittrex, and Poloniex. He subsequently moved the proceeds into bank accounts in the Bahamas under his control.

Although Roger Ver renounced his American citizenship, the two companies he controlled remained American corporations. This meant Ver had to report any distributions, such as dividends, from these companies. The indictment alleges Ver concealed both the receipt and sale of these tokens from his accountant. As a result, his 2017 tax return did not report any gains or taxes owed from the tokens’ distribution. This, in turn, led to significant discrepancies in the declared financial activities.

CZ’s Short Sentence Example – Will Ver Face Harsher Penalty?

Just days before his arrest, Roger Ver seemingly foreshadowed his own predicament with a tweet  on April 25. He said: “Don’t expect bad people to do good things.” Once out of prison, Ver might consider a career change, possibly as a late-night TV psychic, given his ironic pre-arrest message.

Ver is no stranger to legal troubles. He previously served time in a US prison for illegally selling explosive materials . This could negatively affect his sentencing for the current tax charges.

Additionally, Ver has been embroiled in recent legal disputes over substantial financial obligations. He was sued over failing to honor a $21 million marker  with an entity related to the bankrupt Genesis Global Capital, part of Digital Currency Group. Before this, he allegedly refused to honor a $47 million marker at the now-defunct CoinFLEX exchange, which filed for restructuring in August 2022. Ver countered by claiming that CoinFLEX owed him money. This dispute did not aid CoinFLEX’s other customers, who ultimately sued former CEO Mark Lamb for allegedly helping Ver’s evade responsibility.

News of Ver’s arrest coincided with the sentencing of Binance founder Changpeng ‘CZ’ Zhao. Zhao received a mere four-month prison sentence, a term much shorter than the Department of Justice’s recommended 36 months. This outcome surprised many observers.

During all these developments, there’s a notable pattern of individuals publicly critical of the BSV Blockchain ending up in legal trouble, as often discussed on platforms like CoinGeek. This might suggest that the reports of their illicit activities are not just speculative.