Former U.S. Secret Service Agent Admits $820,000 Bitcoin Theft in Silk Road Probe

Shaun Bridges, a former Secret Service agent, pleaded guilty on Monday to diverting to his personal account over $800,000 worth of bitcoins during an investigation into online black marketplace Silk Road.

Image: FBI

Image: FBI

Trust in federal law enforcement has been roughly undermined. Shaun Bridges, a former Secret Service agent, pleaded guilty yesterday to have stolen $820,000 worth of bitcoins (although information about his readiness to admit the guilt appeared more than two months ago). The hearing is scheduled for December 7. The theft was discovered during investigation into Silk Road, an online marketplace that became known for its shady dealings.

The details say that Silk Road was used for sale and purchase of drugs and other contraband. The market had been operating for two years until the disclosure and had managed to generate more than $214 million in illegal sale. Its website was shut down by U.S. authorities in November 2014 and operator Blake Benthall, known as Defcon online, was accused of drug trafficking, computer hacking, money laundering and other crimes.

The announcement of Bridge’s admission was made by a team of lawyers including Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Melinda Haag of the Northern District of California, Chief Richard Weber of the IRS-Criminal Investigation (IRS-CI), Special Agent in Charge David J. Johnson of the FBI’s San Francisco Division, Special Agent in Charge Michael P. Tompkins of the Justice Department’s Office of the Inspector General’s Washington, D.C. Field Office, and Special Agent in Charge Lori Hazenstab of the Department of Homeland Security’s Office of the Inspector General in Washington D.C.

Assistant Attorney General Caldwell underlined in press release how harmful this crime for public trust can be. Law enforcement officers don’t only break the law they are intended to serve – they ruin the reputation of much larger entity than just one marketplace. Nevertheless she assured of their quick reaction on illegal acts no matter who is the executor.

U.S. Attorney Melinda Haag echoes: “Mr. Bridges has now admitted that he brazenly stole $820,000 worth of digital currency while working as a U.S. Secret Service special agent, a move that completely violated the public’s trust. We depend on those in federal law enforcement having the highest integrity and unshakeable honor, and Mr. Bridges has demonstrated that he utterly lacks those qualities.  We appreciate the hard work of our federal partners that went into bringing Mr. Bridges to justice.”

According to evidence provided by Bridges, he transferred stolen bitcoin into an account of Mt. Gox, one more infamous digital currency exchange in Japan. Its owner Mark Karpeles was arrested and a little bit later rearrested not long ago. The investigation is going on but he faces accusations of manipulating his own account at the company by making it appear that $1 million was added to it and embezzling $2.6 million in customer funds.

Bridges is not the first federal agent to plead guilty in illegal activity of Silk Road. Carl Force, former U.S. Drug Enforcement Administration agent, was arrested not long ago and pleaded guilty in theft of $700,000 in cryptocurrency on July 1. The court session is scheduled on October 19.

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