While cryptocurrency has gained increasing popularity for being a decentralized and anonymous alternative to traditional currency, those same characteristics have caused many governments to fear their lack of central control and their potential impact on financial security. Their association with criminal aspects of the dark web, such as online marketplaces, have also bolstered those concerns. While the U.S. has been cautious in its approach to cryptocurrency, recent moves by the federal government show that law enforcement is working toward a comprehensive strategy for enforcing laws in the crypto space.
Over the years, the government’s view on cryptocurrency has caused regulators and law enforcement agencies difficulties in determining how to apply existing laws, such as securities and tax laws, to everything from the exchange and storage of digital assets to taxes. Additionally, cybercrime and cybersecurity task forces have targeted cryptocurrency as a means to identify, prosecute, and convict individuals or entities for other crimes, from drug offenses to crimes against national security. Still, the government has taken clear steps to show that it has cryptocurrency in its sights.
As recently as July, an executive order issued by President Donald Trump authorized a new task force for developing guidance in investigations involving cryptocurrency. The Task Force on Market Integrity and Consumer Fraud will, according to the order, protect consumers in the crypto market and target traditional crimes such as investment schemes and money laundering. Earlier this year, the government made similar statements about developing strategies around virtual currencies with a focus on market fraud, and in February announced the formation of a new cybersecurity task force – the Cyber-Digital Task Force – that, among other things, will aid federal law enforcement in accomplishing their mission in cyberspace.
Crypto Crime & Federal Criminal Charges
The newness of cryptocurrency, its evolving use, and the efforts of law enforcement to address can have big implications when it comes to criminal law. These may include:
- Aggressive enforcement of alleged criminal activity involving cryptocurrencies, more investigations, and more indictments
- Increased enforcement of crypto crimes involving fraud and other market or financial-related crimes
- Increased enforcement of crypto crimes involving the dark web, including drug crimes
- Increased enforcement of crypto crimes involving tax evasion
An aggressive enforcement strategy on cryptocurrency may be prompted by the government’s desire to gain a hold on crypto-crime, but while that can translate into more indictments, it does not necessarily mean more convictions. This is particularly true given the very nature of cryptocurrencies and the legal and regulatory gray areas in which they exist. Law enforcement faces great difficulties in investigating and prosecuting crimes involving cryptocurrency, as traditional strategies for "following the money" and proving a case won't necessarily apply in the crypto space. This creates the potential not only for precedent to be set in important cases, but also for more regulatory and enforcement changes intended to ease those difficulties.
Representation in Crypto Crime Cases
In this new and emerging area of law, the future is likely to be shaped in part not only by the government and law enforcement, but also the defense. Defendants charged with crimes involving cryptocurrency will need to work with experienced criminal defense lawyers who have an understanding of cybercrime, cryptocurrency, and the regulatory framework that surrounds them, as well as the ability to challenge the government’s allegations in ways that may very well set precedent.
At Friedman & Nemececk, L.L.C., Attorney Ian N. Friedman and our legal team have that ability, and are prepared to represent clients charged with a range of crimes involving cryptocurrency, including:
- Fraud investment schemes
- Drug crimes, including offenses involving “dark web” marketplaces
- White collar crimes, including money laundering, Ponzi schemes, and fraud
- Computer crimes
- Illegal gambling
- Online sex crimes
- Tax fraud or tax evasion
Discuss Your Case During a FREE and Confidential Consultation
Attorney Ian N. Friedman and our Cleveland-based criminal defense lawyers have earned national recognition for our work protecting the rights, freedoms, and futures of clients facing serious allegations. This includes our work at the forefront of computer-related crimes, including those involving cryptocurrency. With increasing focus on the enforcement of computer and cryptocurrency crimes, we have become noted leaders in this rapidly evolving area of law, and are readily available to provide the targeted and insight-driven defense clients throughout Cleveland and beyond can rely on when facing serious charges.
If you have questions about a case and how our firm may be of assistance, contact us to request a confidential consultation.