US Federal prosecutors have filed tax evasion charges against billionaire Robert Brockman in the largest tax evasion case in the history of the country. Brockman used offshore bank accounts and shell companies to avoid paying as much as $2 billion in taxes he owed to the US government. The accounts were held in tax havens like Switzerland, the Caribbean, and Bermuda. The billionaire was apprehended as a result of a deal that the US government struck with Robert Smith, another billionaire who was also using complex financial arrangements to evade taxes. Smith was forced to pay around $140 million in fines, and also helped the government apprehend Brockman.
Why it matters: Cryptos have widely been a target of negative press over their ability to evade tax laws, but in most cases, the established financial system is used for illegal activities. A series of reports from prominent global institutions confirm this, and cases like Brockman's only serve to drive this point home. While cryptos can be used to skirt banking regulations, there is a massive offshore banking industry that caters to wealthy people who want to avoid taxes in their home country. As cryptos become more mainstream, it will be difficult for many of the platforms to avoid being used for purposes that may be illegal in some jurisdictions, as they are built to be both anonymous and simple to use internationally.