US Dollar Silk Road Agent Pleads Guilty to Money Laundering

A U.S. Secret Service agent who stole $820,000 worth of Bitcoin pleaded guilty yesterday to money laundering and obstruction of justice.

Shaun W Bridges was part of the investigation into Silk Road, a black market on the deep web that allowed the sale of illegal drugs in exchange for Bitcoin.

Bridges, 32, of Laurel, Maryland, admitted in his plea agreement to transferring 20,000 bitcoins (worth about $350,000 in real time) from Silk Road accounts to wallets he controlled.

In January 2013, he used an administrator account to reset passwords and PINs for many accounts on the site.

After Bridges stole the bitcoins, he transferred them to his personal account at the now-bankrupt Japanese bitcoin exchange Mt Gox.

Between March and May 2013, he converted bitcoins into U.S. dollars totaling $820,000 and transferred the funds to a personal investment account contracted with Fidelity Investments. In June 2014, Bridges transferred the money to a personal bank account he shared with another person.

“Mr. Bridges now admits that he brazenly stole $820,000 worth of digital currency while working as an agent for the United States Secret Service, a complete violation of the public trust,” said U.S. Attorney Melinda Haag.

Richard Weber, the head of the IRS Criminal Investigation Division, described the case as a "great example of the financial skills of our agents."

He added: “By analyzing the blockchain and data analytics on the Silk Road website server, we were able to trace the flow of stolen funds, ultimately leading to the defendants.”

Bridges is scheduled to be sentenced on Dec. 7 and faces a maximum sentence of 20 years in prison and a $250,000 fine on each count.