According to a Friday report, the Tax Authorities revealed that they are investigating NFT creators facing possible allegations of tax evasion. The two NFT creators have been accused of failing to file tax revenue returns of up to NIS eight million after NFT sales that were allegedly based on the stones of the Western Wall that were 3D scanned.
Antony Polak from Har Adar and Avraham Cohen from Jerusalem are alleged perpetrators. The two were co-owners of a website, holyrocknft.com, that they used to sell their NFTs. The website aims to merge technological progress in the business world and the Jewish spirit.
Investigators have recently revealed that the co-owners immersed approximately NIS eight million after selling seventeen thousand works since the beginning of 2021. They received a total of 620 ETC worth of payments for sell of the works. Despite all their payments being business earnings, Anthony Polak and Avraham Cohen did not file them as business earnings.
It was later revealed that investigators suspected the two were criminally hiding untaxed property after noticing that some payments and funds were being transferred between crypto wallets.
Tax authority reported that Judge of the Jerusalem Magistrate’s court, Judge Amir Shaked, who was preceding over the case, let the suspects under strict conditions. The Judge ordered the two suspects to turn over the crypto wallet where they stored the ETH.
At the time of the press report, the official website for the Holy Rock NFT read that according to an agreement reached with the Ministry of Religions and the State of Israel, the co-owners have decided to leave the temporary restraining order.
Remember, the order preventing them from trading any more NFT by Holy Rock that was expected to continue until the last day of court proceedings with the State of Israel. However, they ensured that all other platform activities would proceed as planned.
Recent Cyber Crimes on the Western Wall
On February twenty-sixth, another NFT creator, a graphic designer from Tal Aviv, Ben Benhorin, for failing to file income revenue from the trade and conversion of digital currencies received as payment of approximately 30 ETH from the sale of NFT-type digital art.
Ben Benhorin, under the brand name WUWA, was able to create and trade his NFT art on the international platform Opensea. However, despite receiving payment, Benhorin never reported any revenue from the sales of the NFT art; this was found after investigations by the tax authorities in 2021.
Tax Authorities report that Benhorin used a crypto exchange platform called Uniswap to convert crypto received as payment for NFT sales into different currencies. However, he knew that the action was taxable. However, no evidence of the conversions was found submitted by Benhorin.
The rise in NFT cybercrime has come after a recent boom in NFT art in Israel. NFT art in Israel is quickly coming up as NFT exhibitions launched in Tel Aviv last month. First, however, legal boundaries must be clarified since NFT art is still new in Israel.
Several reports and allegations have been reported to court against NFT frauds. However, the cases are still in court awaiting deliberations after a momentary injunction was issued at the state’s request awaiting further settlement. Advocate, Jaguar A. Gal advised Israeli regulators to learn and get information in the NFT field to identify frauds.
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