A pair of former federal agents who were investigating the Silk Road online black market drug operation were arrested Monday and charged with stealing digital currency that buyers and sellers used in transactions, officials said.
Carl Force was a Drug Enforcement Administration agent and Shaun Bridges was a Secret Service agent, both on a task force that investigated the Internet drug ring in several cities including Chicago and New York.
The target of their investigation, website founder, Ross Ulbricht, was convicted last month on numerous counts.
Ulbricht, operating under the name Dread Pirate Roberts, generated about $1.2 billion for the site, the FBI said.
Silk Road first launched in 2011 as an underground website where users could shop for drugs and even weapons with a digital currency known as Bitcoin.
Force, working undercover, "stole and converted to his own personal use a sizable amount of Bitcoins," according to a criminal complaint.
"Rather than turning those Bitcoin over to the government, Force deposited them into his own personal accounts," the complaint said.
Force created fictitious personas to communicate with the site administrator. But some of those personas were not officially sanctioned.
Using one of these personas Force sought $250,000 in exchange for keeping quiet about some of the administrator's activities. He also offered to sell information about the government's investigation into Silk Road in exchange for $100,000 worth of Bitcoin, a sum he received and deposited.
Bridges, meanwhile, funded his own brokerage account by moving $820,000 worth of Silk Road Bitcoins to a Japanese digital currency exchange before transferring it to his own account.
Bridges was charged with money laundering and fraud. Force was charged with wire fraud, theft of government property, money laundering and conflict of interest.
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