5 hours ago
4
A National Crime Agency (NCA) officer has been jailed for stealing £4.4m worth of bitcoin seized during a joint operation with the US Federal Bureau of Investigation (FBI), after the criminal he was investigating told the police it was missing.
Paul Chowles thought he had got away with the crime for five years, prosecutors said, after laundering the money on the dark web and spending £613,000, mostly on day-to-day expenses.
The 42-year-old had been working as an investigator on the case of Thomas White from Liverpool, who ran an online black market for illegal drugs, known as Silk Road 2.0, launched a month after a website of the same name was shut down in 2013 by the FBI.
It was White, while under investigation, who noticed someone had taken 50 bitcoin of the 97 he had, and told police it had to be someone inside the NCA because they had the private keys for his cryptocurrency wallet.
Merseyside police, which had responsibility for managing White in the local area following his release on licence in early 2022, discussed the theft with the NCA, in meetings that Chowles attended.
During the investigation, officers discovered Chowles had stolen the money between 6 and 7 May 2017, two years after the White investigation was over, and in the following five years had been spending it in supermarkets and hardware stores and on fuel and meals, with investigators uncovering hundreds of debit card transactions.
It was initially worth about £60,000 at the time of the theft but skyrocketed in value during the time he was spending it.
Police recovered an iPhone that linked Chowles to an account used to transfer bitcoin as well as relevant browser search history relating to a cryptocurrency exchange service.
Several notebooks were also discovered in Chowles’s office that contained usernames, passwords and statements relating to White’s cryptocurrency accounts.
Alex Johnson, specialist prosecutor with the Crown Prosecution Service’s special crime division, said the defendant had been “regarded as someone who was competent, technically minded and very aware of the dark web and cryptocurrencies”.
He added: “Once he had stolen the cryptocurrency, Paul Chowles sought to muddy the waters and cover his tracks by transferring the bitcoin into mixing services to help hide the trail of money.
after newsletter promotion
“He made a large amount of money through his criminality, and it is only right that he is punished for his corrupt actions.
DCI John Black, from Merseyside police’s intelligence bureau, which carried out the investigation with help from the NCA, said: “[Chowles] took advantage of his position on this investigation to line his own pockets while devising a plan that he believed would cover his tracks. He was wrong.”
Chowles, from Bristol, was sentenced to five and a half years at Liverpool crown court, after pleading guilty to theft, transferring criminal property and concealing criminal property at an earlier hearing.
