US IRS, Chainalysis, Ukraine Target Russians Using Crypto To Avoid Sanctions

IRS-CI Chief Jim Lee said in the recent announcement the training will help participants hone their digital investigative skills to trace the source of blockchain funds.

The US Internal Revenue Service (IRS), Ukraine, and crypto investigations company Chainalysis are jointly working to target Russian oligarchs, who are likely to be using cryptocurrency to evade sanctions. The IRS Criminal Investigation Department is extending all help to Ukrainian investigators by giving them blockchain analysis tools. It has already donated the licenses from a crypto investigation organisation Chainalysis to war-ravaged Ukraine. So far, more than 50 Ukrainian law enforcement officers have taken part in the virtual meeting as the physical training is yet to be conducted.

IRS-CI Chief Jim Lee said in the recent announcement, as quoted by CoinDesk, "These trainings help participants hone their digital investigative skills to trace the source of blockchain funds.”

Lee also said the move will help in unmasking cryptocurrency transactions with cryptocurrency forensic tools. Lee further said, “Sharing tools not only safeguard the U.S. financial system but the global economy also.”

This comes after Russia's invasion of Ukraine, where the countries have allegedly used cryptocurrencies to promote war efforts, evade sanctions and support humanitarian efforts. 

Although, media reports suggest that crypto has not been playing any big role in Russia’s war efforts.

Despite this, US lawmakers have expressed concerns about Russian oligarchs using crypto to evade the US and European economic sanctions on them, reported CoinDesk. At present, IRS-CI has around 23 ongoing investigations related to sanctions.

Commenting on the matter, Cyber Police Department of the National Police of Ukraine police colonel Yurii Vykhodets, said, “We often see fundraising campaigns conducted with the use of cryptocurrency, as Russia believes in the possibility of circumventing sanctions by using virtual assets."

He also added these trainings are timely and provide a strong impetus for more effective work by the Cyber Police in this area. The US IRS-CI's main objective includes conducting financial crime investigations, including tax fraud.

In the recent past, the IRS filed claims worth nearly $44 billion. This was against the estate of bankrupt crypto exchange FTX and its associated organisations.

Meanwhile, the US Department of Justice is also investigating if Binance permitted Russian users to get access of the exchange when it comes to US sanctions violations. The country has imposed multiple sanctions on Russia after its invasion of Ukraine.

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