Texas court orders investor to hand over crypto keys worth $1.1M

A Texas federal court has ordered Frank Richard Ahlgren III, a Bitcoin (CRYPTO:BTC) investor, to surrender all access keys, private keys, and any devices used to store his cryptocurrency after being sentenced for tax fraud.

Ahlgren was sentenced to two years in prison in December 2024 for failing to report over $3.7 million in Bitcoin sales between 2017 and 2019.

He owes approximately $1.1 million in restitution to the U.S. government for underreporting his capital gains.

On January 6, 2025, Austin Federal Court Judge Robert Pitman issued a restraining order that mandates Ahlgren and any associates to provide all details about his cryptocurrency accounts, including public keys, private keys, seed phrases, and access codes.

The court order includes Bitcoin, Bitcoin Cash (CRYPTO:BCH), Bitcoin Gold (CRYPTO:BTG), Ether (CRYPTO:ETH), and Litecoin (CRYPTO:LTC) accounts.

Ahlgren and his associates are prohibited from transferring or concealing any of his cryptocurrency assets unless authorised by the court.

The restrictions will remain in place until the restitution is paid in full or further court orders are issued.

In 2015, Ahlgren purchased 1,366 Bitcoin at around $465 each.

He later sold about half of it in 2017 for $3.7 million, but misrepresented the purchase price on his tax return to reduce the reported capital gains.

Further sales of Bitcoin, totaling over $650,000, were not reported on his tax returns between 2018 and 2019.

This case marks the first criminal tax evasion prosecution focused entirely on cryptocurrency.

Following his prison sentence, Ahlgren was also ordered to serve one year of supervised release.

At the time of reporting, the Bitcoin (BTC) price was $95,667.24.