Ex-NCA Officer Jailed for £613k BTC Heist from Seized Assets

- Ex-NCA officer stole a large amount of Bitcoin from seized dark web assets. - Blockchain analytics traced stolen BTC, leading to prison sentence. On May 24, 2024, a court sentenced former UK National Crime Agency (NCA) officer Paul Caulfield to six years and six months in prison. Caulfield stole a large amount of Bitcoin from seized criminal assets, a sum from which he ultimately gained an estimated £613,000 ($821,345). Caulfield was a lead investigator in a high-profile dark web case connected to the infamous Silk Road marketplace, where he laundered the stolen cryptocurrency through a mixing service before converting it into cash for personal use. On July 17, CoinDesk reported that Caulfield, a 42-year-old from Bristol, unlawfully transferred the Bitcoin in May 2017. At the time, he was the lead analyst examining digital assets that authorities had confiscated from Thomas White, a co-founder of Silk Road. The Bitcoin were worth approximately £60,000 ($77,400) at the time of the theft. To launder the funds, Caulfield used a cryptocurrency mixing service designed to obscure transaction trails, and then spent part of the money through crypto-enabled debit cards. According to prosecutors, he gained an estimated £613,000 ($821,345) from the theft. The crime came to light after Thomas White’s release from prison, as he disclosed that Bitcoin was missing from the wallet authorities had seized during his arrest. His revelations prompted Merseyside Police to launch an investigation, which uncovered the internal theft. Blockchain analytics firm Chainalysis played a pivotal role in the case. Despite Caulfield’s attempts to hide his activity, the firm used its advanced tools to trace the stolen Bitcoin. This analysis successfully linked the transactions back to Caulfield, providing the critical evidence that led to his arrest in May 2022. In May 2024, Caulfield pleaded guilty to charges of theft, transferring criminal property, and concealing criminal property. In addition to his prison sentence, the Crown Prosecution Service will confiscate the illicit proceeds. The NCA, which cooperated in the investigation, has started an internal review of its policies for handling seized crypto assets to prevent similar breaches. This case also aligns with the UK government’s broader efforts to strengthen its legal powers to seize, freeze, and destroy cryptocurrency tied to illegal activities.