UK Tax Authority Seize NFTs for First Time in $1.8M Fraud Case

14 February 2022, 07:06 GMT+0000
Updated by Kyle Baird
14 February 2022, 07:06 GMT+0000
In Brief
  • The HMRC seized three NFTs, according to a BBC report.
  • The three suspects used false information and VPNs to hide their identities.
  • Countries are beginning to take note of the NFT market and potential illicit activity.
  • promo

The United Kingdom’s tax authority has seized three NFTs worth $1.896 million in a suspected case of fraud. Three people have been arrested, and authorities have said that it will continue to adapt to changing technology.

The United Kingdom’s tax authority, Her Majesty’s Revenue and Customs (HMRC), has seized three NFTs in what is at first. The NFT was involved in a suspected $1.896 million case of fraud, with three people arrested, according to a report by BBC.

The HMRC claims that the three suspects used sophisticated methods to mask their identities, including stolen identities, VPNs, false invoices, and addresses, among other things. The executives from the agency were stern about the use of NFTs to commit crimes, with the deputy director of economic crime Nick Sharp saying,

“[this] serves as a warning to anyone who thinks they can use crypto assets to hide money from HMRC. We constantly adapt to new technology to ensure we keep pace with how criminals and evaders look to conceal their assets.”

The investigation is ongoing and could spark further inquiry into the NFT market. This is the first time that such a move has been made by a governmental department in the NFT space. Cryptocurrencies themselves have been seized on various occasions, but the NFT market, which is becoming a growing hotbed for illicit activity, now looks like it’s on authorities’ radars as well.

NFTs market supervision

NFTs have been one of the most controversial aspects of the crypto market in recent times. While it has done a lot to engage the wider public audience, many have called it a fad, adding that the collectibles they represent are grossly overvalued. This, in turn, has led to prominent individuals saying that it could lead to heavy losses for many.

/Related

More Articles

The hype surrounding NFTs is catching the attention of regulators as a result. So far, the Thai SEC is the only regulator to have banned NFTs, banning memecoins alongside it. But with more regulation with respect to the overall crypto-asset class expected this year, NFTs too could see more restrictions.

However, it’s unlikely that will dampen the desire of both investors and companies. The latter especially is keen on leveraging NFTs to engage audiences, and the growth of the metaverse has been a particularly illustrative point in that regard.

Disclaimer

BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.