The US Justice Department announced charges on Monday against two former federal agents accused of stealing the digital currency Bitcoin during the investigation of the underground drug marketplace Silk Road.
Carl Force, a former Drug Enforcement Administration agent, and Shaun Bridges, a special agent with the Secret Service, were charged in a criminal complaint filed in the San Francisco federal court with offences including wire fraud and money laundering.
Force, 46, and Bridges, 32, belonged to a Baltimore-based federal task force investigating the Silk Road, which was shut down by authorities in October 2013. Force had a prominent role in the probe, authorities said, as he was the lead undercover agent in communication with Ulbricht.
But prosecutors said while Force spoke with Ulbricht using an officially sanctioned alias, he also created unauthorised online personas to communicate with the accused Silk Road founder, also known as "Dread Pirate Roberts."
Using those aliases, Force extorted US$250,000 (A$327,000) from Ulbricht and later offered to sell him information about the government's investigation for US$100,000, the complaint said.
Prosecutors said Force also stole US$90,000 worth of Bitcoins that Ulbricht paid him under an officially sanctioned alias used for the undercover investigation.
Authorities said Bridges, 32, meanwhile diverted to his personal account over US$800,000 worth of bitcoin that he controlled during the Silk Road investigation.
Force was arrested in Baltimore on Friday and expected to appear in court there later Monday. Bridges surrendered and was scheduled to appear in court in San Francisco.
Steven Levin, a lawyer for Bridges, said he maintains his innocence. An attorney for Force could not be immediately identified. Ulbricht's lawyer had no immediate comment.