Michaela Alvez
Early cryptocurrency investor Frank Richard Ahlgren III has been ordered by U.S. District Judge Robert Pitman to hand over the private keys to his Bitcoin (BTC) wallet and other digital asset storage devices.
The court order follows Ahlgren’s December 2024 conviction for tax fraud, which resulted in a two-year prison sentence. Ahlgren’s case holds particular significance as the first U.S. criminal tax evasion prosecution focused exclusively on cryptocurrency trading.
Judge Pitman’s order goes beyond requiring access to Ahlgren’s crypto wallets. It prohibits him and his associates from transferring or concealing any digital assets without prior court approval. However, they are permitted to use funds for “normal monthly living expenses.”
Bloomberg reports that the court’s ruling seeks to access approximately 69,370 BTC, valued at $124 million in digital assets linked to Ahlgren while recovering $1 million in court-ordered damages.
Frank Ahlgren Case Details
Ahlgren, who operated under the alias “Paco,” was indicted on seven charges related to tax fraud in February 2024. The Satoshi-era Bitcoin investor faced three counts of filing false tax returns and four counts of illegal structuring of cash deposits. Ahlgren was accused of concealing $3.7 million in capital gains from Bitcoin sales to avoid paying taxes.
The Department of Justice alleges that Ahlgren employed advanced financial methods to conceal his activities on the blockchain. Although the Bitcoin blockchain is public and unchangeable, certain protocols can be used to obscure transactions to some extent.
“Instead of paying the taxes he knew were due, Frank Ahlgren lied to his accountant about the extent of a large portion of his gains, and sought to conceal another chunk of his profits,” acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division said in a press release from December 2024.
The Frank Ahlgren case has raised important questions about the intersection of digital assets and tax regulation, with experts noting that it could set a precedent for future cases involving cryptocurrency-related tax evasion. Ahlgren’s legal team has expressed frustration with the handling of the case, particularly the DOJ’s use of civil asset forfeiture to seize the assets.
The court’s decision is part of broader efforts by U.S. authorities to clamp down on financial crimes involving cryptocurrency, as the sector faces increasing scrutiny and regulatory attention.
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Michaela has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
