NFTs Seized for the First Time in the UK, Part of Probe into Fraud Case

Her Royal Majesty’s Revenue and Customs (HMRC), the UK’s tax department, became the first authority in the country to seize three NFTs as part of an ongoing investigation into a $1.9 million fraud case. Alongside the NFTs — which are yet to be appraised — around $6,762 worth of crypto assets have also been seized and three suspects have since been arrested.

The suspects involved were believed to have used “sophisticated methods” in their attempt to claim more value-added tax (VAT) than what they were owed. They likewise resorted to using stolen identities, unregistered phones, false addresses, and false invoices to hide their identities and appear to engage in legitimate business activities across 250 alleged fake companies.

“Our first seizure of a Non-Fungible Token serves as a warning to anyone who thinks they can use crypto assets to hide money from HMRC,” explained HMRC deputy director of economic crime Nick Sharp. “We constantly adapt to new technology to ensure we keep pace with how criminals and evaders look to conceal their assets.”

The US Department of Justice had also just recently seized over $3.6 billion worth of crypto assets, which has been linked to the 2016 hack of Bitfinex, a cryptocurrency exchange. With the continued rise in prominence of emerging technologies, it is highly likely that similar cases and circumstances will become increasingly common given the vulnerability of the space to thefts and scams.

Following the seizure of NFTs in the UK, Elliptic policy and regulatory affairs head David Carlisle notes that criminals “can’t hide in the world of crypto.” “Enforcement agencies are able to track and trace criminals’ transactions, and seize NFTs and crypto assets used in illicit activity, robbing criminals of their profits.”

Sources: CNBC, The Verge, BBC