The Internal Revenue Service (IRS) has reportedly “stepped up” its pursuit of taxpayers who haven’t reported and paid taxes on cryptocurrency transactions by getting a court order to gain access to a bank’s data relating to customers who used a digital currency broker.
The court order requires M.Y. Safra Bank to turn over data for sFOX, a digital broker that used the bank, CNBC reported Monday (Sept. 26).
This isn’t the first time the IRS has made such a summons, but the broker named in the summons is smaller than those that have been the subject of a summons in the past, according to the report.
An IRS spokesperson told PYMNTS that the agency has no comment on the report beyond what is said in the court order.
sFOX received a summons of its own on Aug. 23, sFOX Chief Compliance Officer John Mannino wrote in a statement on the company’s website that was updated Sept. 23 after the IRS issued a summons to M.Y. Safra Bank.
Mannino said in the statement that the IRS said there is no allegation that sFOX has engaged in wrongdoing. He added, “sFOX always adheres to the law and will be helpful and respectful in any investigation, while also ensuring that we protect our customers’ personal or private information.”
As PYMNTS reported Aug. 16, a court ruling lets the IRS serve a “John Doe” summons on sFOX, letting the agency hunt for possible tax evaders using the company’s services.
Read more: Today in Crypto: Crypto Nomads Move Back to Big Cities; Court OKs IRS Tax Probe of Dealer SFOX
A John Doe summons allows the IRS to information about possible tax evaders whose identities are unknown. There is no allegation in the summons filed Sept. 22 that M.Y. Safra has engaged in wrongdoing, according to a Sept. 22 press release issued by the U.S. Attorney’s Office for the Southern District of New York.
IRS Commissioner Charles P. Rettig said in the release, “The court’s granting of the John Doe summons reinforces our ongoing, significant efforts to ensure that everyone pays their fair share. Taxpayers earning income from digital asset transactions need to come into compliance with their filing and reporting responsibilities.”