A former officer of the United Kingdom’s National Crime Agency (NCA) has been sentenced to five and a half years in prison for stealing 50 Bitcoin, now worth approximately $5.9 million, that had been confiscated from Silk Road 2.0 co-founder Thomas White.
The Crown Prosecution Service reported on Wednesday that Paul Chowles, who worked as an operational officer with the NCA and led data extraction and analysis on White’s devices, pleaded guilty in May to charges of theft, transferring criminal property, and concealing criminal property.
Silk Road 2.0, which launched shortly after the FBI shut down the original Silk Road marketplace in October 2013, operated for about a year before authorities dismantled it in late 2014. During White’s arrest in November 2014, the NCA seized 97 Bitcoins, worth roughly $79,000 at the time. However, in May 2017, 50 Bitcoins were transferred from White’s wallet to another address.
Investigators later discovered that Chowles used Bitcoin mixing services, including Bitcoin Fog, to obscure the origins of the stolen funds. Blockchain analytics firm Chainalysis revealed that portions of the laundered Bitcoin were converted into cash through crypto exchanges or spent via crypto-enabled debit cards.
Within the NCA, Chowles was widely regarded as a competent officer with technical expertise in cryptocurrency and the dark web. According to Alex Johnson of the Crown Prosecution Service (CPS),
“He took advantage of his position working on this investigation by lining his own pockets while devising a plan that he believed would ensure that suspicion would never fall upon him.”
Initially, the NCA assumed White himself had managed to transfer the funds. However, White insisted that only the agency held the keys to his wallet and that an insider must have moved the Bitcoin.
The investigation took a turn after Merseyside Police, collaborating with the NCA, discovered evidence linking Chowles to the theft. Chowles used two crypto-enabled debit cards to spend around £109,425 ($146,580). The CPS, however, estimated that he benefited financially by approximately £613,150 ($821,345).
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