Patrick Yaroch faces an FBI agent cryptocurrency theft case after federal prosecutors charged the FBI supervisor with transferring nearly $1 million from cryptocurrency accounts into his personal wallet. He was temporarily detained on Monday, and a hearing was set for Tuesday.
Patrick Yaroch and Russia
The charges accuse Yaroch of interstate transportation of stolen goods and receipt of stolen goods. Two sources familiar with the matter said the adversarial nation was Russia. The case centers on transfers from cryptocurrency accounts tied to that nation into a wallet he controlled.
The affidavit says he made up to a dozen transfers totaling about $925,426.07. Yaroch was detailed to the U.S. intelligence community, which makes the alleged use of FBI systems part of the central question in the case. Prosecutors say he found the keys needed to move money from wallets to himself after going into FBI systems.
FBI headquarters disclosure
Yaroch told a Justice Department employee that he was frustrated the FBI could not or would not act against adversarial cryptocurrency accounts. He also said he was upset he could not do more to disrupt cryptocurrency use by an adversarial nation during an investigation. That account matters because the affidavit says he never interacted with anyone associated with the adversarial accounts, including foreign entities.
He later submitted an online FBI self-report form and met voluntarily with personnel at FBI headquarters. There, he said he wanted to disclose something because he had screwed up. The affidavit says he confessed because he was ashamed and said it was eating him up inside.
Monday detention in WASHINGTON
When the FBI searched his home, Yaroch handed over his FBI credentials and details of his cryptocurrency wallets. On Monday, U.S. Magistrate Judge Lindsey R. Vaala ordered him temporarily detained. The FBI said it immediately took action after learning of the allegations, that the individual has since been fired from the Bureau, and that it is conducting a thorough investigation in the aftermath.
Tuesday’s hearing will put the charges and detention issue back before the court. For now, the case turns on how Yaroch says he obtained the access needed to move the funds and whether prosecutors can show the transfers came from systems he was never supposed to use that way.
