Austin Man Pleads Guilty to Cryptocurrency Tax Fraud
AUSTIN — An Austin resident, Frank Richard Ahlgren III, recently pled guilty to what prosecutors describe as nearly four million dollars in cryptocurrency tax fraud. This significant legal development took place in federal court on September 3, 2024.
Details of the Case
Ahlgren’s issues with the law didn’t begin recently. Back in February 2024, he was arrested for allegedly failing to report a large sale of $3.7 million in bitcoin that occurred in 2017. In addition, he also didn’t report close to $650,000 in cryptocurrency sales on his tax returns for 2018 and 2019.
The case came under investigation by the IRS Criminal Investigation division and the Texas Office of Attorney General. According to the Department of Justice (DOJ), Ahlgren used all the money he made from his bitcoin sale to purchase a home located in Park City, Utah.
Filing False Tax Returns
Along with his large purchase, Ahlgren also filed a false tax return for the year 2017 with the IRS. This return improperly inflated the cost basis of the bitcoins he sold. As a result, this misrepresentation led him to underreport his capital gains from the bitcoin sale. In total, the DOJ reports that Ahlgren caused a tax loss to the IRS of more than $550,000.
Plea Agreement and Further Proceedings
The plea agreement is currently under review. U.S. District Judge Robert Pitman requested U.S. Magistrate Judge Mark Lane to look at this agreement closely. Judge Lane has recommended that the court accept Ahlgren’s plea.
However, the plea agreement has not been finalized yet. If the court decides against accepting it, the case will go to a jury trial, where the circumstances surrounding the alleged fraud will be examined in greater detail.
Potential Consequences
If Ahlgren is found guilty, he faces serious penalties. He could potentially spend a maximum of three years in prison. Additionally, he may face hefty fines and possibly more probation once his sentencing is determined.
Conclusion
Ahlgren’s case serves as a reminder of the ongoing scrutiny and regulations surrounding cryptocurrency transactions and the importance of accurately reporting income to tax authorities. As this case progresses, more information may come to light regarding the implications for individuals engaging in cryptocurrency trading without proper adherence to tax laws.
