An article by Robert Mazur
A little over a month ago, KYC360 published my article about how the IRS has been starved of resources by Republican controlled Congresses during the past 10 years, especially the IRS’s Criminal Investigation Division that focuses on prosecuting our country’s fat-cats that treat income tax evasion as a sport.
While the rest of us U.S. citizens pay our fair share, a portion of the ultra-wealthy have seen the IRS stripped of funding for its experts, increasingly tempting some of the mega-wealthy to turn a blind eye to paying their fair share.
I made the case that, with a 31% budget cut to the IRS Criminal Investigation Division, criminal tax convictions have dropped by 43%. To some of the wealthy and their sophisticated facilitators that news garnered the equivalent of throwing blood in the water to those sharks that hide billions.
In one case alone made public this week, despite having to fight with one hand tied behind their back due to underfunding, the IRS Criminal Investigation Division announced their seizure of $3.36 billion worth of cryptocurrency. That money was ripped from the grasp of a crook that would never have been tracked down without the talents of IRS Special Agents trained to do the thankless job of targeting and prosecuting our country’s biggest tax cheats.
This story began in 2011
Ross Ulbricht, the creator of the “darknet” black market named Silk Road orchestrated more than $500 billion in sales of illegal drugs, computer hacking services, malicious software, forged identity documents, stolen financial and/or identity information, and even murder-for-hire services.
All those illegal goods and services were paid for with Bitcoin, one of the most popular cryptocurrencies in the world. Although Ulbricht was found guilty and sentenced to life in prison in 2015, his profits from those sales vanished into thin air, until IRS Special Agents took on the task of finding it.
What they just uncovered is that more than $3.36 billion of Ulbricht’s Silk Road profits were stolen by yet another computer genius, James Zong of Georgia. Zong had hacked into secret accounts of Ulbricht and stolen billions of illegal proceeds.
A mammoth undertaking
In an affidavit filed by IRS Special Agent Trevor McAleenan, he spelled out for a U.S. District Court Judge the mammoth undertaking he and his colleagues took to obtain enough evidence to execute a search warrant and seize Zong’s illegal billions.
Yes, as he and his colleagues should when executing a search warrant on the home of a major criminal hiding billions, Special Agent McAleenan and his colleagues were armed. Unlike some uninformed Right-Wing critics of the IRS that think this special unit of the IRS should only carry pencils, McAleenan and his fellow IRS Special Agents carried 9mm Glock handguns and wore Kevlar vests covered by raid jackets. If U.S. Senator Ted Cruz had his way, this unit of the IRS and the entire agency would be abolished, which would be a tremendous loss for our country.
McAleenan’s affidavit makes it obvious that he and his colleagues have very special talents that are desperately needed to catch the biggest and most sophisticated criminals. They not only work on cases like that of Zong, they work on cases involving terrorist financing, global drug traffickers, sanctioning oligarchs, mobsters, and corrupt politicians.
In this case, Special Agent McAleenan conducted forensic analyses of computer servers used to operate the Silk Road dark-web internet marketplace, participated in the search of Zong’s home and reviewed items seized during the search. Then he analyzed records from banks, credit card companies, cryptocurrency exchanges, message boards, internet service providers, a blockchain tracking provider, and e-commerce merchants.
He and his colleagues put the thousands of pieces of evidence together that put more than $3.36 billion in the US Treasury, funds that will enable our country to defray the cost of providing some services to its citizens without putting that $3.36 billion price tag on the backs of middle-class taxpayers.
The DOJ’s largest ever cryptocurrency seizure
Not only was this seizure the largest cryptocurrency seizure in the history of the U.S. Department of Justice, but it also remains the Department’s second largest financial seizure ever.
The heroic effort by the IRS Criminal Division in the prosecution of James Zong was spelled out in a press release issued by the Department of Justice. It’s time for some politicians to read that press release and stop skewing the public’s perception by taking cheap shots at the IRS Criminal Division.
Most often, that division and other IRS employees that work hard to ensure tax evaders are met with justice get bashed by some politicians that care less about fair tax administration and more about pandering to frustrated taxpayers that rarely see what the Trevor McAleenans of the IRS try to do every day to fulfill their oaths to serve and protect our nation.
I’m glad I could share his story.
Robert Mazur, a federal agent for 27 years, is a court-certified expert in money laundering related matters in both the U.S. and Canada. He is the New York Times best-selling author of “The Infiltrator,” a memoir about the first half of his life undercover as a money launderer within Pablo Escobar’s Medellin Cartel, and was an executive producer of the film by the same name. His new book, “The Betrayal,” is a memoir about his final undercover assignment, a deep dive into Colombia’s Cali Cartel and Panama’s underworld that nearly cost him his life. He is president of KYC Solutions, a company that provides speaking, training, consulting and expert witness services globally.
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