Of all the stories to come out of the cryptocurrency industry in 2019, the QuadrigaCX story is perhaps one of the most captivating as it was a tale of miscalculations, scandal, and possible deceit. The story gained mainstream attention when QuadrigaCX, a now-defunct cryptocurrency exchange announced that hundreds of millions of user funds have been lost in the cold wallet that only their late CEO had access to and following his sudden death, the funds have been lost. Since then, there has been a back-and-forth trying to recover some of the funds or compensate victims in some way even as the company folds up.
Now, it has been reported on September 16, 2019, that the Canadian Revenue Authority intends to audit QuadrigaCX’s tax returns.
Quadriga and the Taxman
According to the report, the CRA intends to look into the tax returns for QuadrigaCX for the period of Oct. 1, 2015, to Sept. 30, 2018, and this has been declared to be a legitimate move by EY which is the trustee that is handling QuadrigaCX’s bankruptcy filings.
“The Trustee intends to discuss the request for information with CRA Audit and their counsel and will return to Court for further direction, if necessary,” EY said.
While EY admits that there is no basis to refuse the request for information from the various government agencies that have requested it from QuadirgaCX, they do admit that responding to all these requests might have some effect on the amount of money that will be available to distribute between the 115,000 creditors of QuadrigaCX.
“Accordingly, the Trustee is focused on conducting its document collection, organization, review and production efforts in as cost-effective a manner as possible […] it is not expected that the Trustee will be in a position to respond to the CRA Audit request at this time,” they have stated.
Even as EY deals with the requests from the various governmental agencies, they also have to deal with creditors breathing down their neck for some sort of compensation as well as those that continue to insist that this is a giant exit scam and that Gerald Cotton, their late CEO, is not dead.