Connection: Marc Karpeles --> Silkroad

[AGD]

I was already wondering about the connection between Marc Karpeles and Silk Road my another related topic here: https://bitcointalk.org/index.php?topic=935434.msg11122821#msg11122821

It is interesting, that Marc's Dwolla account gets seized by the HSI and short time later Ross Ulbricht writes in his journal:

29/05/2013 - $2M was stolen from my mtgox account by DEA.

So Marc gets his money seized and Ross complaints about this beiing his money?

I would like to know more about this specific connection. Anyone knowing more?

Links:
http://cdn.arstechnica.net/wp-content/uploads/2013/05/Mt-Gox-Dwolla-Warrant-5-14-13.pdf

Journal found on Ross Ulbrichts laptop
http://antilop.cc/sr/exhibits/253456476-Silk-Road-exhibits-GX-240B.pdf
http://antilop.cc/sr/exhibits/253456478-Silk-Road-exhibits-GX-240C.pdf
http://antilop.cc/sr/exhibits/GX-240D.pdf

[Eastfist]

Karpeles and Ulbricht were best of friends back at Harding.

Just like Carl Mark Force had his little techie stoolie Shaun Bridges, Ulbricht's techie stoolie would have been Karpeles. Because, apparently, wannabe kingpin Ulbricht wasn't good at tech stuff. Karpeles should be ashamed for selling out his buddy angel boy Ross Ulbricht.

[AGD]

I see. So the MtGox Dwolla account was probably created for his buddy Ross then. That would indicate that Marc knew about the illicit business Ross was into.

[Eastfist]

I see. So the MtGox Dwolla account was probably created for his buddy Ross then. That would indicate that Marc knew about the illicit business Ross was into.

I don't doubt it at all. None of the early adopters are going to admit anything, just like the backstabbers they are. Things turn out the way they turn out for a reason.

[Blazr]

Allegedly what happened is Silk Road had an account at Mt Gox, which it used to hedge against variances in the Bitcoin price.

On Silk Road, Bitcoins that were held in escrow were often hedged against the dollar, so that fluctuations in the Bitcoin price didn't affect the seller. To do this Silk road sold Bitcoins on MtGox and eventually held a balance of $2 million on an account there. Apparently what happened is that the MtGox account was hacked, one theory is that the API key was stolen from files on the server by some guy Ross hired to help him use freeBSD which Silk Road was running at the time and that he used it to drain the balance.

DPR emailed MtGox about the theft, and after that he suspected the DEA had seized the account and wrote about it in his journal.

After Ross' arrest MtGox said that they had already been suspicious of this particular accounts activity and that they became more suspicious after the theft as the owner never contacted LE or did anything about this massive theft and this is the account they were talking about when they told the FBI they could help them find DPR.

[AGD]

Allegedly what happened is Silk Road had an account at Mt Gox, which it used to hedge against variances in the Bitcoin price.

On Silk Road, Bitcoins that were held in escrow were often hedged against the dollar, so that fluctuations in the Bitcoin price didn't affect the seller. To do this Silk road sold Bitcoins on MtGox and eventually held a balance of $2 million on an account there. Apparently what happened is that the MtGox account was hacked, one theory is that the API key was stolen from files on the server by some guy Ross hired to help him use freeBSD which Silk Road was running at the time and that he used it to drain the balance.

DPR emailed MtGox about the theft, and after that he suspected the DEA had seized the account and wrote about it in his journal.

After Ross' arrest MtGox said that they had already been suspicious of this particular accounts activity and that they became more suspicious after the theft as the owner never contacted LE or did anything about this massive theft and this is the account they were talking about when they told the FBI they could help them find DPR.

So there has been a theft of 2 Mio from DPR's MtGox account and in addition there was the seizure of 2.9 Mio from Marc's Dwolla account?

[Whitehouse]

I was already wondering about the connection between Marc Karpeles and Silk Road my another related topic here: https://bitcointalk.org/index.php?topic=935434.msg11122821#msg11122821

It is interesting, that Marc's Dwolla account gets seized by the HSI and short time later Ross Ulbricht writes in his journal:

29/05/2013 - $2M was stolen from my mtgox account by DEA.

So Marc gets his money seized and Ross complaints about this beiing his money?

How are a Dwolla and Silk Road account related?

Karpeles and Ulbricht were best of friends back at Harding.

Just like Carl Mark Force had his little techie stoolie Shaun Bridges, Ulbricht's techie stoolie would have been Karpeles. Because, apparently, wannabe kingpin Ulbricht wasn't good at tech stuff. Karpeles should be ashamed for selling out his buddy angel boy Ross Ulbricht.

Or Ulbricht should be ashamed about trying to sell out Karpeles by trying to pass all the blame onto him at his trial. Ross was obviously the main guy here and you seem to be making a lot of assumptions based on little to no evidence.

[Blazr]

So there has been a theft of 2 Mio from DPR's MtGox account and in addition there was the seizure of 2.9 Mio from Marc's Dwolla account?

Yes, they were two different thefts, well one was a seizure but thats pretty much the same thing. That is very suspicious now that you mention it, perhaps it really was seized and MtGox are trying to pretend the account was hacked. The warrant for the Dwolla seizure was signed by the same corrupt cop that stole the other Silk Road money too....... I have a feeling there is more to this story.

[S4VV4S]

So there has been a theft of 2 Mio from DPR's MtGox account and in addition there was the seizure of 2.9 Mio from Marc's Dwolla account?

Yes, they were two different thefts, well one was a seizure but thats pretty much the same thing. That is very suspicious now that you mention it, perhaps it really was seized and MtGox are trying to pretend the account was hacked. The warrant for the Dwolla seizure was signed by the same corrupt cop that stole the other Silk Road money too....... I have a feeling there is more to this story.

Force or the other one?
And yeah, I think we will find out more along the way.

[bitllionaire]

The agent investigating it has always suspected, but I think that once ross was found, the suspect is over

[OgNasty]

What would happen if it came out that the "stolen" mtgox coins are the very same coins that the DEA confiscated from Silk Road? Would the government have to pay back mtgox creditors for stealing and auctioning off their coins?

[louise123]

What would happen if it came out that the "stolen" mtgox coins are the very same coins that the DEA confiscated from Silk Road? Would the government have to pay back mtgox creditors for stealing and auctioning off their coins?

I am sure that they are going to go after Karpeles.

But I don't think so because Karpeles lost a lot more.
The coins could however be a major part of the Gox stolen coins

[AgentofCoin]

What would happen if it came out that the "stolen" mtgox coins are the very same coins that the DEA confiscated from Silk Road?

My understanding is that the "silkroad coins" were found on Ross's laptop, not within the Mt.Gox server(s).
Ross had it open, in a non-encrypted format, allowing them all to be swept into their own gov controlled btc address.
It is possible that this story is actually incorrect and was created as cover and etc, for the Court proceedings.
It is now known that certain aspects of the Prosecution were not based in technical mechanics and fact, and seemed to be insider info. (Karpeles?)

Would the government have to pay back mtgox creditors for stealing and auctioning off their coins?

Great question! But I think not, since USA gov would state that the coins were used for the purpose of illegal activity.
It is kind of like when Police seize a vehicle used for drug sales. They will seize the vehicle and it becomes their property.
If you had a loan on the car, you would still be obligated to pay it, even though the Police seized and sold the actual collateral.
The Police would not pay the bank on your behalf, from the sale proceeds. You would still be on the hook. I believe, IMO.

But very interesting indeed.

[Eastfist]

What would happen if it came out that the "stolen" mtgox coins are the very same coins that the DEA confiscated from Silk Road? Would the government have to pay back mtgox creditors for stealing and auctioning off their coins?

I'm pretty damn sure the Mt. Gox stolen bitcoins are the very same bitcoins those crooked agents stole. You have to use some logic here. Relatively speaking, no one knew enough about Bitcoin at the time except the early adopters, and those two agents were there from Bitcoin's inception.

[AGD]

I will try to put up my first theory:

- Marc Karpeles opens a US Dwolla account in the name of his company Mutum Sigillum, LLC./MtGox to help his long time friend Ross laundering the Bitcoins that were made with SilkRoad.

- HSI confiscates this Dwolla account with at least 2.9 Mio USD (maybe a lot more)
- Marc K. agrees in a deal with DEA to help to take down his friend Ross

09/05/2013 - US Secret Service Agent BRIDGES serves as the affiant on a multi-million dollar seizure warrant for Mt. Gox and its owner's bank accounts.

("multi-million dollar seizure" does not sound like this was 2.9 Mio. Maybe it was part of the deal to give him back some part of the "multi-million seizure")

14/05/2013 - The Department of Homeland Security and U.S. District Court for the District of Maryland issued a Seizure Warrant for the funds associated with a Dwolla account belonging to Mt.Gox
29/05/2013 - Chicago HSI Agent Jared Der-Yeghiayan, sought a search warrant for Karpeles’s e-mail account, swearing in a draft affidavit that he suspected Karpeles of being the Dread Pirate Roberts.

- Marc K. tells Ross/DPR, that the DEA (instead of the HSI) has confiscated the money. Dunno what the goal was. Maybe bringing Ross into making errors. He has been stressed by the made up murder story and the DDOS attacks etc, so he was likely to make errors in short term.
- Ross writes in his journal that 2 Mio were stolen from his account on MtGox from the DEA

29/05/2013 - $2M was stolen from my mtgox account by DEA.

- short time later DEA has a clear record, where Ross was logging in as DPR.

03/06/2013 - "Someone" logged into a server used to administer the Silk Road website from an Internet Cafe located near Ulbricht's residence.

It is possible that Marc K. gave all the infos about what he knew from Ross to agent Jared Der-Yeghiayan and he just had to made up the story how he found Ross' GMX mail adress and the "altoid" posts etc.
So officially Marc was later sued for unlicensed money business and behind closed doors he was probably acting as the main informant to take down Ross Ulbricht/Silk Road. Marc Karpeles played the main role in Silk Road as a money launderer and was flipped by the DEA in fear of losing his business, which he lost later anyway.

[louise123]

I will try to put up my first theory:

- Marc Karpeles opens a US Dwolla account in the name of his company Mutum Sigillum, LLC./MtGox to help his long time friend Ross laundering the Bitcoins that were made with SilkRoad.

- HSI confiscates this Dwolla account with at least 2.9 Mio USD (maybe a lot more)
- Marc K. agrees in a deal with DEA to help to take down his friend Ross

09/05/2013 - US Secret Service Agent BRIDGES serves as the affiant on a multi-million dollar seizure warrant for Mt. Gox and its owner's bank accounts.

("multi-million dollar seizure" does not sound like this was 2.9 Mio. Maybe it was part of the deal to give him back some part of the "multi-million seizure")

14/05/2013 - The Department of Homeland Security and U.S. District Court for the District of Maryland issued a Seizure Warrant for the funds associated with a Dwolla account belonging to Mt.Gox
29/05/2013 - Chicago HSI Agent Jared Der-Yeghiayan, sought a search warrant for Karpeles’s e-mail account, swearing in a draft affidavit that he suspected Karpeles of being the Dread Pirate Roberts.

- Marc K. tells Ross/DPR, that the DEA (instead of the HSI) has confiscated the money. Dunno what the goal was. Maybe bringing Ross into making errors. He has been stressed by the made up murder story and the DDOS attacks etc, so he was likely to make errors in short term.
- Ross writes in his journal that 2 Mio were stolen from his account on MtGox from the DEA

29/05/2013 - $2M was stolen from my mtgox account by DEA.

- short time later DEA has a clear record, where Ross was logging in as DPR.

03/06/2013 - "Someone" logged into a server used to administer the Silk Road website from an Internet Cafe located near Ulbricht's residence.

It is possible that Marc K. gave all the infos about what he knew from Ross to agent Jared Der-Yeghiayan and he just had to made up the story how he found Ross' GMX mail adress and the "altoid" posts etc.
So officially Marc was later sued for unlicensed money business and behind closed doors he was probably acting as the main informant to take down Ross Ulbricht/Silk Road. Marc Karpeles played the main role in Silk Road as a money launderer and was flipped by the DEA in fear of losing his business, which he lost later anyway.

I wouldn't be surprised if this was Mark's doing.
By the way, I am guessing he was following the trial closely: https://www.reddit.com/r/Bitcoin/comments/2tc9vi/ive_been_at_the_ross_ulbricht_trial_every_day_ama/cnxtwea

[Whitehouse]

I will try to put up my first theory:

- Marc Karpeles opens a US Dwolla account in the name of his company Mutum Sigillum, LLC./MtGox to help his long time friend Ross laundering the Bitcoins that were made with SilkRoad.

- HSI confiscates this Dwolla account with at least 2.9 Mio USD (maybe a lot more)
- Marc K. agrees in a deal with DEA to help to take down his friend Ross

Theory? Based on what? It seems like pure fantasy to me without some supporting evidence. If DPR was pals or even a business associate of Mark he would have mountains of evidence from chats/emails/messages etc and would have leaked them or provided them as supporting evidence to his accusations that Mark was the main DPR. I've yet to see any evidence at all that Karpales had any ties to SR's operation.

[AGD]

I will try to put up my first theory:

- Marc Karpeles opens a US Dwolla account in the name of his company Mutum Sigillum, LLC./MtGox to help his long time friend Ross laundering the Bitcoins that were made with SilkRoad.

- HSI confiscates this Dwolla account with at least 2.9 Mio USD (maybe a lot more)
- Marc K. agrees in a deal with DEA to help to take down his friend Ross

Theory? Based on what? It seems like pure fantasy to me without some supporting evidence. If DPR was pals or even a business associate of Mark he would have mountains of evidence from chats/emails/messages etc and would have leaked them or provided them as supporting evidence to his accusations that Mark was the main DPR. I've yet to see any evidence at all that Karpales had any ties to SR's operation.

I would have named it "fact" instead of "theory" if had any real proof.

My theory is based on the "coincidences" that Marc's account gets seized by HSI and Ross complaints about 2 Mio of his mtgox money stolen by DEA at about the same time and shortly after having a hand on Marc, they find Ross' real location, while they already had infiltrated agents at admin staff for months before that.

This pretty much looks like the friend turns into mole story to me.

[louise123]

I will try to put up my first theory:

- Marc Karpeles opens a US Dwolla account in the name of his company Mutum Sigillum, LLC./MtGox to help his long time friend Ross laundering the Bitcoins that were made with SilkRoad.

- HSI confiscates this Dwolla account with at least 2.9 Mio USD (maybe a lot more)
- Marc K. agrees in a deal with DEA to help to take down his friend Ross

Theory? Based on what? It seems like pure fantasy to me without some supporting evidence. If DPR was pals or even a business associate of Mark he would have mountains of evidence from chats/emails/messages etc and would have leaked them or provided them as supporting evidence to his accusations that Mark was the main DPR. I've yet to see any evidence at all that Karpales had any ties to SR's operation.

OK, what makes you think that the existing evidence were not manipulated anyway?
I am sure there was some level of manipulation by the crooked cops.