HMRC Seizes Three NFTs in Fraud Crackdown

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  • HMRC has seized three NFTs in a UK first
  • The three assets were taken as part of a fraud investigation
  • The NFTs will likely be auctioned once they have been valued

HMRC, the UK’s tax authority, has seized three NFTs as part of an investigation into a suspected fraud scheme involving 250 fake companies. The authority revealed on Monday that it had arrested three people on suspicion of attempting to defraud it out of £1.4 million ($1.8 million), representing the first such seizure by HMRC, with the NFTs themselves likely to go up for auction later this year.

NFT Seizure is UK First

Although the NFTs themselves have not yet been valued, HMRC said it had secured a court order to seize them along with other crypto assets worth about £5,000 ($6,765). The suspects are alleged to have used “sophisticated methods to try to hide their identities including false and stolen identities”, HMRC said.

The potential for using NFTs for criminal enterprises such as fraud or money laundering have been known for a while, but this represents the first time that anyone, in the UK at least, has been arrested on charges relating to it.

The HMRC deputy director economic crime, Nick Sharp, said the NFT seizure “serves as a warning to anyone who thinks they can use crypto assets to hide money from HMRC”, adding that the agency will continue to “constantly adapt to new technology to ensure we keep pace with how criminals and evaders look to conceal their assets.”

NFTs Will Likely Go Up For Auction

In the UK, seized goods are usually auctioned off when the cases are closed. The first seized Bitcoin auction took place in 2019, and assuming that these three NFTs are treated the same way, they will get auctioned off too. It is not yet known what NFTs they are, but should they turn out to be Bored Apes or Crypto Punks then interest could be very high indeed.