2 Federal Agents Charged With Stealing Bitcoins During Silk Road Investigation
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— Carl Force (@engediINC) April 6, 2014
An agent from the DEA and an agent from the Secret Service have been charged with wire fraud and money laundering for stealing and extorting Bitcoin during the federal investigation of the Silk Road online marketplace. The agents are alleged to have successfully taken money from the founder of Silk Road, Ross Ulbricht, during an investigation into a possible murder-for-hire scheme as well as stealing seized funds.
After obtaining the money the agents laundered it using private accounts. In one case money was laundered to Panama and in another case funds were laundered to Mt. Gox which would later be seized by federal authorities partly due to the orders of the agent involved in the theft. Both agents privately enriched themselves using their power as law enforcement officials according to the indictment.
Ulbricht, who supposedly went by the moniker “Dread Pirate Roberts,” has already been convicted for his involvement in drug trafficking but with these revelations the murder-for-hire case may not make it to court.
The agents now facing charges led a Baltimore-based murder-for-hire case against Ulbricht, separate from the drugs-related charges on which he was found guilty. The murder-for-hire case remains pending. Prosecutors identified the agents as Carl Force, 46 years old, of Baltimore, a special agent with the Drug Enforcement Administration, and Shaun Bridges, 32, of Laurel, Maryland, a special agent with the U.S. Secret Service…
Using the online persona “French Maid,” Force did succeed in getting $100,000 in Bitcoin from Ulbricht, which Force deposited in his personal accounts, the federal complaint says. He later used a series of Bitcoin and personal U.S. dollar transactions, including a $235,000 wire transfer to an account in Panama, to launder the stolen money, prosecutors allege in the complaint…Bridges allegedly stole $820,000, using a series of wire transfers to move Bitcoin that earlier had been stolen from Silk Road in early 2013 and deposited in a Japanese bitcoin exchange Mt. Gox, according to prosecutors. Two days later, Bridges signed the government’s warrant to seize millions of dollars in bitcoin from Mt. Gox accounts.
The evidence of misconduct by federal agents was kept out of Ulbricht’s drug trafficking trial though it seems likely that Ulbricht may use the information to try and reopen that case. The investigation Force and Bridges were apart of did result in an indictment but, not surprisingly, prosecutors have not been anxious to advance the case.
Ulbricht’s lawyer now calls the entire investigation into his clients activities “fatally compromised from the inside.”