Will Israeli Authorities Continue Their Crack Down on Cryptocurrencies?
The Israeli Tax Authority have revealed that they, in collaboration with Israeli police have arrested four citizens. This was announced on the Tax Authorities official Facebook page.
Police & Tax Authority Raid
In the early hours of the morning Israeli police in co-operation with the Israeli Tax Authorities have apprehended the citizens in a sting-like operation. They were suspected of operating a cryptocurrency exchange without reporting their profits to the Israeli Tax Authority.
Israeli tax law dictates that any sale of cryptocurrencies by an Israeli citizen or permanent resident is required to be reported to local tax authorities.
The four suspects have been arrested and are undergoing an investigation. for money laundering and not abiding to Israeli Tax Authority laws.
During their arrest, investigators from the Israeli Tax Authority collaborated with the Cybercrime, Yahalom and K9 units of the police. They have conducted a search for digital storage devices, presumably cold storage wallets to cement their case against the suspects. During the search millions of Israeli Shekels in cash have been seized by the authorities.
With the Israeli Shekel valued at $0.3 U.S. Dollars it could be estimated that the authorities could have seized roughly $1 million.
Bitin Takes a Blow
The four individuals were revealed later by Globes to have been to be the management of the Israeli cryptocurrency exchange Bitin. This includes the CEO Bar Mittleman, while the 3 others have not yet been identified.
Bitin operated in a similar manner to a cryptocurrency ATM. Users could purchase or sell a wide variety of cryptocurrencies including Bitcoin, Ethereum, Litecoin and Ripple and Bitcoin Cash to name a few. The purchase or sale of cryptocurrencies would be done via cash in their office, bank transfer or via delivery. They also offered products such as cold storage wallets.
It is important to note that unlike a different Israeli cryptocurrency exchange BT360, Bitin did not offer custodial services or mobile cryptocurrency wallet services. None of Bitin's clients have complained so far of losing funds despite their temporary closure.
Bar Mittleman, Bitin's CEO has had his arrest extended until March 3rd while the three others are expected to be released by tomorrow.
Israeli authorities have previously hinted about a harsher enforcement of rules in regard to cryptocurrencies last week. It is possible that we will see them take action against others within the local cryptocurrency space.
Written by Jonathan Ganor
Writer & cryptocurrency aficionado