Fallout from Silk Road continues after former DEA undercover agent pleads guilty to extorting bitcoins
A former US federal investigator involved in the Silk Road probe has pleaded guilty to stealing funds during the official investigation of the online marketplace best known for selling drugs.
Carl Force, 46, admitted to stealing more than $700,000 (£448,011) in Bitcoin during the probe, after Force and another agent (former Secret Service special agent Shaun Bridges) were officially charged back in March this year of offences including wire fraud and money laundering.
Silk Road was shut down in October 2013 with the arrest of Ross Ulbricht, its alleged founder, known online by the pseudonym “Dread Pirate Roberts”.
Ulbricht was found guilty in February of charges including conspiracy to commit drug trafficking and money laundering, but an appeal is pending. Several others involved with the site as administrators have also been convicted.
The underground website is estimated to have generated about $200 million (£135m) in sales using the digital currency Bitcoin, with Ulbricht allegedly earned $18m in Bitcoin from the operation.
Former Drug Enforcement Administration (DEA) agent Force was part of the federal task force investigating Silk Road.
He had a leading role in the probe, being the primary undercover agent tasked with communicating with “Dread Pirate Roberts”. He posed as a drug dealer with connections to hit-men using the alias Nob.
But Force now faces up to 20 years in prison after he pleaded guilty to charges of extortion, money-laundering and obstruction of justice. He stole more than $700,000 (£448,000) in the digital currency Bitcoin.
Prosecutors said he also created unauthorised pseudonyms to communicate with “Roberts”, allegedly using them to extort $250,000 from Ulbricht and offering to sell him information about the government’s investigation for $98,000.
Force apparently reported the discussion to the DEA, but he falsely claimed no payment had been made. In reality however he had diverted the funds to a personal account.
Another crime Force admitted to was agreeing a contract with 21st Century Fox to help make a film about the Silk Road investigation, without the permission of his supervisors. Part of that deal with Hollywood called for him to be paid up to $240,000.
Force also invested in a company that brokered Bitcoin and served as its chief compliance officer while still with the DEA. He used this position to seize $300,000 from a customer and transfer it to his private account.
The BBC reported that the US district judge Richard Seeborg accepted Force’s guilty plea on Wednesday and scheduled his sentencing for October.
“He had a stellar, 15-year career with the DEA except for this one blip,” said Force’s lawyer Ivan Bates. He had argued in court that Force had suffered from anxiety and depression.
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