Federal agents charged with stealing from Silk Road during undercover investigation
Silk Road was shut down because it facilitated the illegal sale of drugs, firearms, malware, and other black market wares found on the deep Web. Its shuttering was supposed to be a feather in the cap of a government struggling to keep pace with criminals' increasing reliance on computers over street corners.
But two federal agents thought it could serve another purpose: making them rich.
The New York Times reports that the two agents -- one from the Drug Enforcement Administration, the other from the Secret Service -- will be arrested later today for funneling bitcoins seized from Silk Road to their own personal Bitcoin wallets instead of to the wallets the government set up to auction off the seized property.
Both agents are said to have participated in a Baltimore-based investigation into Silk Road, whose alleged founder, Ross Ulbricht, was convicted in February. The investigation centered on allegations that Ulbricht tried to have several people killed; he was later convicted of running Silk Road, but the evidence that he tried to solicit these assassinations wasn't admissible. Now we might know why.
The agents in question both quit shortly after they realized the government was investigating them. One will be charged with wire fraud, theft of government property, and money laundering; the other with simply wire fraud and money laundering.
The revelation is just another spectacular twist in the story of Silk Road's downfall. Others include allegations that Ulbricht was merely a fall guy and that Mt. Gox chief executive Mark Karpeles was thought to be the drug marketplace's true mastermind. Combine that with the fact that the investigation was into an online black market whose operator is said to have hired assassins and you've got almost everything needed for a blockbuster movie.
All that's missing? A good guy.