FBI agent stole $2.47m in crypto from criminal wallets

Law enforcement officers are trusted to handle sensitive evidence properly. A 37-year-old former FBI supervisor used that access to steal millions in cryptocurrency. Patrick Steven Yaroch pleaded guilty on November 5 to wire fraud and money laundering after stealing approximately $2.47 million from cryptocurrency wallets linked to FBI investigations.

He stole the money from wallets held by people the FBI was investigating, which included adversarial nation-state actors. Starting no later than December 2024, he made around 100 transfers using credentials tied to 35 separate investigations.

The theft method

The FBI's search affidavit says that Yaroch accessed FBI systems containing wallet seed phrases and memorized them. A seed phrase is a series of words, commonly 12 or 24, used to restore access to a cryptocurrency wallet. Anyone with the seed phrase can potentially control the funds.

He then used the memorized phrases to transfer funds to a personal wallet on his own device. He subsequently swapped assets into different currencies and made further transactions to try and hide their origins.

Planned escape

According to the affidavit, Yaroch had asked ChatGPT how to invest a million dollars, along with advice on where to live in Europe. It suggested Portugal, and he began the process of setting up a life there.

His justification for the theft was frustration that the FBI wasn't acting quickly enough against the wallets' criminal owners. So he decided to "take matters into his own hands," according to the affidavit. He also used some of the proceeds to cover personal debts, including credit cards, car payments, and other loans.

Caught and consequences

According to the affidavit, he approached a former DOJ colleague to confess because his actions were "eating him up inside." The employee urged him to self-report, which he did. The FBI placed him on leave and then terminated his employment two days later.

They showed up at his home with a warrant and seized assets, including his phone, which had access to a Kraken cryptocurrency account. They also seized a piece of paper containing the seed phrases for his own account.

This isn't an isolated incident. In December 2024, former Secret Service agent Anthony Joseph Evans pleaded guilty to stealing cryptocurrency worth $56,000 from a hardware wallet held in the agency's secure evidence vault. In 2015, former Secret Service agent Shaun W. Bridges also pleaded guilty to money laundering and obstruction of justice after stealing bitcoin during the investigation of Silk Road.