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A former officer of the National Crime Agency has been sentenced to five and a half years in prison for misappropriating 50 Bitcoins valued at £4.4 million ($5.9 million) from evidence collected during a Silk Road investigation, utilizing cryptocurrency mixers to launder the assets through numerous transactions over a span of four years.
Paul Chowles, 42, was a member of the NCA team examining organized crime syndicates on the dark web marketplace Silk Road and its successor, Silk Road 2.0.
Paul Chowles source: cps.gov.uk
How He Gained Access to the Funds Initially
As reported by CPS, Chowles was responsible for the analysis and extraction of cryptocurrency from devices confiscated from Thomas White, the co-founder of Silk Road 2.0, who received a 64-month prison sentence in April 2019.
On May 6 and 7, 2017, Chowles transferred 50 of the 97 Bitcoins taken from White’s “retirement wallet” to public addresses in two separate transactions.
The misappropriated cryptocurrency was subsequently processed through Bitcoin Fog, a well-known mixing service utilized to launder illicit proceeds and obscure transaction trails.
The officer converted the Bitcoin into pounds sterling and utilized the funds via Cryptopay and Wirex debit cards over several years.
He conducted 279 transactions totaling £23,309 with the Cryptopay card and expended £79,885 through the Wirex account between August 2021 and July 2022.
At Liverpool Crown Court, Chowles admitted to theft, transferring criminal property, and concealing criminal property.
The Crown Prosecution Service estimated that he gained financially to the tune of £613,147 through his illicit actions, although the stolen Bitcoin was valued at only £59,409 at the time of the theft.
Silk Road Co-Founder Reveals Internal Theft
The theft went unnoticed for years as the NCA investigation team initially believed that White had somehow accessed his wallet and removed the Bitcoin himself.
By late 2021, the missing cryptocurrency had been classified as untraceable by authorities.
White, who had been convicted and was undergoing Proceeds of Crime Act proceedings with a confiscation order of £1,560,506, noticed the unauthorized transfer and alerted the police.
He indicated that only someone within the NCA could have accessed his cryptocurrency wallet since they held the private keys.
The NCA liquidated the remaining 47 Bitcoins to satisfy part of White’s confiscation order, leaving £1,066,956 still owed.
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Merseyside Police took over the management of White in the local area following his release on license in early 2022 after completing his prison sentence.
During a meeting between Merseyside Police and NCA officials to discuss the White investigation, officers became aware of the stolen Bitcoin.
Chowles was present at this meeting, where the theft was openly discussed among law enforcement personnel.
Merseyside Police initiated an investigation into the missing cryptocurrency and apprehended Chowles in May 2022.
Authorities recovered an iPhone linking him to accounts used for Bitcoin transfers, along with browser search history related to cryptocurrency exchange services.
Evidence Trail Uncovers Systematic Cryptocurrency Laundering
Police found several notebooks in Chowles’ office containing usernames, passwords, and statements pertaining to White’s cryptocurrency accounts.
The notebooks provided essential evidence of his access to the confiscated digital assets and his systematic approach to theft.
Importantly, Blockchain analytics firm Chainalysis also aided in tracing the movement of funds through various exchanges and mixing services.
The firm’s tools identified how portions of the stolen Bitcoin were converted to cash at exchanges and loaded onto crypto-enabled debit cards for more convenient spending.
The timing of the theft coincides with increased scrutiny of government Bitcoin sales and seizures.
The U.S. Department of Justice received authorization in December 2024 to sell 69,370 Bitcoins, valued at approximately $6.5 billion, seized from Silk Road.
However, the Trump administration had suggested establishing a Strategic Bitcoin Reserve instead of liquidating seized assets.
Senator Cynthia Lummis took to X Wednesday after reports emerged that the U.S. may not hold as much Bitcoin in its reserve as believed.#CynthiaLummis #BitcoinReservehttps://t.co/FWyTqWqIIG
— Cryptonews.com (@cryptonews) July 16, 2025
Senator Cynthia Lummis took to X Wednesday after reports emerged that the U.S. may not hold as much Bitcoin in its reserve as believed.#CynthiaLummis #BitcoinReservehttps://t.co/FWyTqWqIIGRoss Ulbricht, the founder of the original Silk Road, received a full presidential pardon in January 2025 after serving over a decade in prison.
His case became one of the most prominent prosecutions in cryptocurrency history, processing over 1.5 million transactions valued at $213 million in Bitcoin.
The Crown Prosecution Service has indicated it will pursue confiscation proceedings against Chowles to recover the remaining financial benefit from his criminal actions.
The post UK Crime Officer Jailed for Stealing 50 Bitcoins Worth £4.4M During Silk Road Investigation appeared first on Cryptonews.
