ZachXBT Accuses IRS of Harassment, Seeking Assistance

Blockchain investigator ZachXBT has alleged that he’s been subjected to what he perceives as borderline harassment by the Criminal Investigation (CI) Unit of the United States Internal Revenue Service (IRS), as they persistently seek his aid in blockchain investigations.

In a post on X dated March 6, ZachXBT detailed his concerns, asserting that while he’s willing to assist victims and support law enforcement with necessary information, he believes the U.S. law enforcement agency has overstepped his “personal boundaries” in their pursuit of his assistance in solving blockchain-related crimes.

“They have shown up irl to old addresses, contacted personal emails using private data, and have sent mail when I have public contact methods readily available,” said ZachXBT.

ZachXBT Harassed by US Officials

According to ZachXBT, IRS-CI agents have resorted to various tactics, including visiting old addresses in person, contacting personal emails using private data, and sending mail despite the availability of public contact methods.

One of the shared images included an email from an IRS-CI special agent praising ZachXBT’s work and seeking guidance in navigating the blockchain space, indicating the agent’s limited experience in the crypto/cyber arena.

ZachXBT characterized the multiple forms of contact as a “blatant disregard for any professionalism.”

Tension Escalates Between ZachXBT and the IRS

The tension escalated after ZachXBT declined to assist holders of the Complex (SIMPLE) memecoin, minted on the Base blockchain, following the project’s abrupt shutdown on April 4. He expressed reluctance to dedicate significant time to assisting individuals who willingly invest in speculative meme coins rather than prioritizing genuine victims.

“I have always been willing to support victims of scams with documentation needed by law enforcement to aid cases but if you overstep personal boundaries why would I want to assist you?” said ZachXBT.

IRS Seeks to Crackdown on Crypto

Meanwhile, the IRS has been actively forging partnerships with notable individuals and companies in the blockchain tracing domain. In May 2023, IRS-CI Chief Jim Lee emphasized the critical role of the unit’s collaboration with blockchain analytics firm Chainalysis, emphasizing that their tools and infrastructure have become indispensable in investigating crypto-related crimes.

Lee revealed that the IRS-CI had seized cryptocurrency assets worth $10 billion since initiating investigations into various crimes involving digital assets.

The allegations made by ZachXBT shed light on the complexities and ethical considerations surrounding law enforcement’s engagement with independent investigators in the burgeoning field of blockchain forensics, highlighting the need for transparent and respectful collaboration between all parties involved.