Ex-NCA Officer Sentenced for Stealing Bitcoin Seized in Silk Road Probe

Highlights:

• Paul Chowles stole 50 BTC from seized Silk Road funds and laundered them using crypto tools.
• Chowles spent the stolen Bitcoin through debit cards and hid his actions for years during an active investigation.
• Merseyside Police arrested Chowles after evidence linked him to stolen funds and unauthorized crypto transactions.

A former officer from the National Crime Agency has received a five-and-a-half-year prison sentence for stealing Bitcoin from criminal evidence. Paul Chowles, aged 42, worked on a team investigating illegal activity on the Silk Road and Silk Road 2.0 dark web marketplaces. During the investigation, the NCA seized 97 Bitcoins from Thomas White, a co-founder of Silk Road 2.0. Chowles managed the process of analyzing and extracting cryptocurrency data from White’s digital devices.

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Former UK National Crime Agency officer jailed for stealing 50 Bitcoins in Silk Road 2.0 investigation

A former British National Crime Agency (NCA) officer has been jailed for stealing 50 bitcoins in the Silk Road 2.0 investigation. Silk Road 2.0 was a successor to…

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In May 2017, Chowles transferred 50 of those Bitcoins to different public addresses through two transactions. At the time, the stolen cryptocurrency was worth approximately £59,000. He later used Bitcoin Fog, a well-known mixing service, to hide the origin of the funds. This service helped him launder the coins and made it difficult for investigators to trace them.

Chowles converted the cryptocurrency to British pounds and spent the money over several years. He used Cryptopay and Wirex debit cards to carry out everyday transactions. Investigators later discovered that Chowles spent £23,309 through Cryptopay and another £79,885 through Wirex. The NCA failed to detect the theft for years because investigators believed White had somehow accessed his wallet. That assumption delayed any internal investigation and allowed Chowles to hide his actions.

Silk Road Probe Unravels Laundering Trail Hidden for Years

In early 2022, Merseyside Police took over local supervision of Thomas White after his release from custody. During a scheduled meeting between Merseyside officers and NCA personnel, officials discussed the Bitcoin that had gone missing from the original seizure. Chowles attended this meeting, unaware that his theft would soon come under renewed attention. At that time, White had already reported his suspicion that someone inside the NCA had moved the funds without authorization.

Merseyside Police initiated a new investigation into the lost cryptocurrency shortly after the meeting. They detained Chowles in May 2022 and seized an iPhone that connected him to the stolen funds. The device had account information and search history associated with cryptocurrency exchanges. They also discovered a couple of notebooks in his office with usernames, passwords and other information related to his crypto accounts.

This piece of evidence confirmed that Chowles had access to the wallet of White and indicated that he schemed the theft. Investigators established that the stolen Bitcoin was spent on personal expenditures that Chowles netted after exchanging it for fiat currency. He used crypto-linked debit cards to make hundreds of transactions. Chainalysis, a blockchain analytics company, assisted with the investigation by monitoring how funds were used across different services after the theft.

Confiscation Proceedings Underway Following Bitcoin Theft Case

The Crown Prosecution Service confirmed it would pursue confiscation proceedings to recover the financial benefit from Chowles. Authorities have continued to trace how he spent and transferred the stolen Bitcoin from the Silk Road probe. Meanwhile, Donald Trump pardoned former Silk Road founder Ross Ulbricht after assuming office. The founder had served over 11 years in prison.

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