Busted by British Authorities
Britain’s tax watchdog has seized three non-fungible tokens, in what is thought to be the first seizure of NFTs by a U.K. law enforcement agency. The seizure came as part of a suspected value-added tax (VAT) fraud case worth £1.4m involving 250 fake companies.
NFTs are assets in the digital world that can be bought and sold using traditional currency or crypto currency, such as Bitcoin, but which have no tangible form of their own. The digital tokens, which emerged in 2014, can be thought of as certificates of ownership for virtual or physical assets.
VAT is a broadly based consumption tax assessed on the value added to goods and services.
HM Revenue and Customs on Monday said it had seized the NFTs and arrested three people on suspicion of fraud. The suspects in its fraud case were alleged to have used “sophisticated methods” to try to hide their identities including false and stolen identities, false addresses, pre-paid unregistered mobile phones, Virtual Private Networks (VPNs), false invoices and pretending to engage in legitimate business activities.
Officials said that the seizure was a “warning to anyone who thinks they can use crypto assets to hide money.”
“We constantly adapt to new technology to ensure we keep pace with how criminals and evaders look to conceal their assets.”
HMRC said it had secured a court order to detain the seized crypto assets worth about £5,000 and three digital artwork NFTs, which have not been valued, while its investigation continues.
This is unlikely to be the last time we hear about authorities seizing NFTs as cryptocurrencies have exploded in price.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
