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Two Silk Road Investigators Face Massive Fraud Charges

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Annabelle Bamforth
New Hampshire-based writer Annabelle Bamforth is TruthInMedia.com's editor-in-chief, focused on breaking the left/right paradigm through new media and local politics. To share a news tip, contact annabelle@truthinmedia.com.

Prosecutors announced on Monday that two former federal agents have been arrested on charges of wire fraud and money laundering stemming from their investigation of the Silk Road online marketplace.

Two former federal agents have been accused of stealing hundreds of thousands of dollars during their investigation of Silk Road, an online marketplace that authorities called “the most sophisticated and extensive criminal marketplace on the Internet.” The two defendants are Carl Force, a former special agent for the Drug Enforcement Administration (DEA), and Shaun Bridges, a former Secret Service special agent.

Force and Bridges were assigned to a task force based in Baltimore investigating Silk Road. Force was the lead investigator working undercover, and Bridges was a computer forensics expert working on the case.

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According to a press release from the Justice Department, Force “served as an undercover agent and was tasked with establishing communications with a target of the investigation, Ross Ulbricht, aka ‘Dread Pirate Roberts.'” Force was authorized to communicate with Dread Pirate Roberts (DPR) online to gather information, but he allegedly went on to create several unauthorized, fictitious online identities.

Force allegedly “used fake online personas, and engaged in complex Bitcoin transactions to steal from the government and the targets of the investigation. Specifically, Force allegedly solicited and received digital currency as part of the investigation, but failed to report his receipt of the funds, and instead transferred the currency to his personal account. In one such transaction, Force allegedly sold information about the government’s investigation to the target of the investigation,” stated the press release. According to Forbes, Force deposited money amounting to three times his government salary into his bank account between 2012 and 2013. The Baltimore Sun reports that it was found by IRS investigators that Force made about $775,000 in that 2-year period, and used the money to pay off a loan and his mortgage, and to make various investments.

Bridges allegedly stole more than $800,000 in digital currency from the Silk Road that fell under under his control during the Baltimore Silk Road investigation. “The complaint alleges that Bridges placed the assets into an account at Mt. Gox, the now-defunct digital currency exchange in Japan. He then allegedly wired funds into one of his personal investment accounts in the United States mere days before he sought a $2.1 million seizure warrant for Mt. Gox’s accounts,” stated the press release.

Force faces charges of wire fraud, theft of government property, money laundering and conflict of interest. Bridges faces charges of wire fraud and money laundering.

Force and Bridges were investigated about nine months before the trial for Ross Ulbricht began. Force reportedly became aware of the investigation in May 2014 and resigned.

Ulbricht’s defense team did not know of the investigation into the two former agents until five weeks before Ulbricht’s trial, and the information regarding the alleged actions of Force and Bridges was sealed by prosecutors. “The Government’s efforts to keep the Carl Force scandal out of the public eye at trial is in itself scandalous,” said Joshua Horowitz,a defense attorney for Ulbricht. “The recently filed Complaint which names Carl Force as a defendant demonstrates that the Government’s investigation of Mr. Ulbricht lacked integrity, and was wholly and fatally compromised from the inside.”

Ulbricht was found guilty in February of all charges relating to the operation of Silk Road. While he faces sentencing on May 15th, he filed a motion for a new trial on March 8th, and his lawyer reportedly believes the scandal surrounding Force and Bridges could help in his motion.

“There was considerable litigation, including a portion of our post-trial motions, that was related to this but has remained sealed,” Joshua Dratel, Ulbricht’s attorney, told Motherboard. “This is an important component of our motion, and will be amplified in our reply now that the charges have been instituted formally.”

The criminal complaint filed against Force and Bridges can be read here.

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