The Canadian Revenue Agency (CRA) is seeking information about clients from major crypto exchanges. The tax agency is asking for the identity of every client on Coinsquare, a major crypto platform. The CRA says it is trying to fight tax fraud and an underground economy. In a September filing to federal court, the Canadian Revenue Agency requested that a judge make Coinsquare hand over information. These documents regarded clients dating back to the company’s inception in 2013.
The agency cited tax fraud as a major concern for seeking information.
The Canadian tax agency cited tax fraud as a major concern in the document, though there may be more to it. According to the National Post, details are too scarce to determine the CRA’s overall plan. However, the Canadian national paper speculated that the CRA would be comparing past tax returns to information in the Coinsquare documents. The CRA probing Coinsquare may not be the end of investigations, however. According to Canadian tax lawyer David Piccolo quoted in the National Post, the CRA could perform audits.
The first time the CRA has actively requested such information from a crypto exchange.
The tax agency would not say if Coinsquare’s probing was related to other recent activity. Earlier this year, the Ontario Securities Commission levied CAD $2.2 million in sanctions and costs against the firm. This came after information from a whistleblower that detailed fake trading. Coinsquare fired the whistleblower, then tried to cover up the issue. According to Piccolo, this is the first time the tax agency has actively requested such an extensive amount of information about crypto transactions. It will test the agency’s ability to process massive amounts of information, he says. Coinsquare has around 200,000 accounts.
