Guilty pleaNorthern Texas
Founders of Crypto ICO Plead Guilty to Tax Evasion After Raising $24 Million from Investors
Oct 12, 2021 · Sourced to the U.S. Department of Justice
This case reached the guilty plea stage in the Department of Justice's public record. Everything below reflects only what the government itself announced, and links to the original release.
The owners of the cryptocurrency company Bitqyck have pleaded guilty to tax evasion.
Defendants
- Bruce Bise — age 60 · pleaded guilty
- Samuel Mendez — age 65 · pleaded guilty
Charges
Tax Evasion
Max: five years in prisonBruce Bise· pleaded guilty
Tax Evasion
Max: five years in prisonSamuel Mendez· pleaded guilty
Financial actions
- fine: $8.3 million — SEC penalty to resolve claims that it defrauded investors and operated an unregistered digital asset exchange
- disgorgement and penalties: $890,254 — Disgorgement and penalties agreed to as part of SEC civil settlement
- disgorgement and penalties: $850,022 — Disgorgement and penalties agreed to as part of SEC civil settlement
From the announcement
“Transacting in virtual currencies does not exempt businesspeople from paying income taxes. These crypto-savvy defendants exploited an emerging technology, lying to their investors, pocketing the proceeds, and concealing the income from the IRS. The Department of Justice is committed to ensuring that every taxpayer pays his or her fair share – and to protecting the crypto space from bad actors.”
“As digital currencies continue to emerge as an investment option for taxpayers, we must continue to increase the pressure on anyone who tries to take advantage of their investors and taxpayers through fraud and tax evasion. The great work from both the Dallas and Los Angeles IRS-CI field offices firmly puts that pressure on these two cybercriminals and serves as a warning to others,”
“Mr. Bise and Mr. Mendez exploited the growing appeal of digital currency and defrauded thousands of victim-investors out of millions of dollars that they used to pay their personal expenses, rent, gambling activities, and purchases of vehicles and art,”
“These fraudsters required investors to produce cash, and then converted the fraud proceeds to cryptocurrency to purposefully circumvent financial reporting requirements. IRS Criminal Investigation is committed to protecting Americans and pursuing financial schemes even into the crypto world.”
“those individuals who missed out on Bitcoin”
“earned gift”
Investigating agencies
U.S. Attorney's Office for the Northern District of TexasInternal Revenue Service - Criminal InvestigationInternal Revenue Service - Criminal InvestigationSecurities & Exchange Commission
Case details
- Prosecuting office
- Northern District of Texas
- Assets
- Bitqy, BitqyM, Bitcoin, Ethereum
CryptocurrencyFinancial Reporting CircumventionInitial Coin Offering (Ico) FraudInteragency Law Enforcement CooperationInternational DimensionInvestor FraudSecurities ViolationsTax Evasion
Primary source
Every fact above is drawn from the Department of Justice's own announcement — a public-domain government record.
Read the original DOJ release →This is a research and reference page compiled from public DOJ announcements, not legal advice. Details reflect the government's statements as of its release date and may not capture later developments such as appeals, dismissals, or overturned convictions. Defendants are presumed innocent unless and until proven guilty.