In December 2015, ex-Secret Service agent Shaun Bridges was sentenced to 71 months in federal prison for the theft of government-seized bitcoin. On Monday, the US government brought money laundering charges against the rogue agent.
During the course of the US government’s 2013-2015 investigation into Silk Road, Secret Service agent Shaun Bridges quietly stole about 20,000 bitcoin. Although he attempted to flee the country, Bridges was eventually brought to justice, as were Carl Force (another corrupt Secret Service agent) and the creator of Silk Road, Ross Ulbricht (who used the fictitious name “Dread Pirate Roberts”). In 2015, Ulbricht was found guilty by a jury and was sentenced to life in prison. Bridges and Force both pled guilty and received a 71-month sentence and a 78-month sentence, respectively. It would seem that the Silk Road case was finally closed. But, all thrilling stories need an epilogue.
On August 14, 2017, the US government filed money laundering charges against Bridges in the District Court for the Northern District of California. Prosecutors assert that Bridges laundered bitcoin through the now-defunct MtGox exchange as well as BTC-e. If convicted, Bridges faces up to a decade longer in prison, in addition to a $250,000 fine.
The Silk Road epic should teach non-crypto people that many popular cryptocurrencies are much less anonymous than commonly believed. Connecting the dots between wallet addresses through forensic analysis is an arduous but feasible process. While legislators worry about bitcoin being used for illicit purposes and terrorism, industry insiders understand that the real threats are unregulated international exchanges and more advanced cryptographic tokens.
The eternal race between thieves and cops has simply shifted online. Instead of outrunning the boys in blue, criminals now strive to hide their digital identities. This battle between good and evil parallels the struggle between cryptographers and codebreakers. As financial crime becomes more technologically complex, it’s a relief to know that the “good guys” are keeping pace.