I had covered the government’s filing over on DataBreaches.net a few weeks ago, but this article by Jerry Brito is something more people should read – even if you’ve never used bitcoin and don’t envision yourself using it:
It is understood and accepted that, if someone is investigated for tax evasion, a bank or brokerage may be required to turn over private financial records to the government. However, Americans would be shocked if the IRS asked a financial institution in good regulatory standing to turn over the names, addresses and shopping histories of millions of customers just because the IRS thought there might be some tax cheats among them. But that’s exactly what the IRS did in a recent court filing against the bitcoin exchange Coinbase.
The IRS has petitioned a court to let it serve what is known as a “John Doe” summons, which requires a business to turn over information about any of its customers that match specific criteria. The summons applies as long as the government can’t get the information elsewhere and has “a reasonable basis for believing that such person or group or class of persons may fail or may have failed to comply with any provision of the tax laws.”
In this case, the specific criteria are not very specific at all. The government is seeking the information on every U.S. customer who used the exchange between 2013 and 2015 – a class so broad that it encompasses millions.
Read more on American Banker.
h/t, Joe Cadillic