Alleged Misappropriation of BTC: Federal Officer in Court Over Cryptocurrency Theft

A federal police officer, William Wheatley, is currently undergoing a committal hearing in the Melbourne Magistrates’ Court this week, facing accusations of misappropriating a significant sum of Bitcoin allegedly seized from an online drug-trafficking operation. The charges against Wheatley include theft, dealing with property suspected to be the proceeds of crime, and leveraging information for personal gain.

The case traces back to January 2019 when investigators, led by the Icarus Taskforce comprising members from Victoria Police and the Australian Federal Police, raided a residence in Hoppers Crossing as part of Operation Viridian. During the raid, large quantities of illicit substances, particularly steroids, were discovered alongside evidence pointing to cryptocurrency transactions.

Detective Sergeant Deon Achtypis, testifying in court, revealed that a Trezor-brand hardware cryptocurrency wallet was seized during the operation. Subsequently, it was alleged that Wheatley, a suspended federal police officer, orchestrated the transfer of 81.616 Bitcoin from the confiscated wallet shortly after its seizure.

The investigation, initially focused on accomplices of the drug traffickers, took a turn in 2021 when new tracing tools hinted at potential police involvement. Further scrutiny revealed connections between IP addresses associated with the Australian Federal Police headquarters and the movement of the cryptocurrency, leading investigators to suspect internal involvement.

Cryptocurrency investigator Craig Gillespie corroborated these suspicions, indicating that transactions from the wallet were traced to withdrawals deposited into Wheatley’s bank account between 2019 and September 2022.

During the court proceedings, AFP officer Jesse Wyatt testified that he sought Wheatley’s expertise upon discovering the cryptocurrency wallet during the raid, highlighting Wheatley’s specialization in cybercrime within the AFP.

In defense, Wheatley’s lawyer, Luke Barker, argued that the case against his client is circumstantial, signaling their intent to contest the allegations.

With the value of Bitcoin significantly appreciated since the alleged incident, the stakes of the case have soared, with the seized amount now valued at over $6.3 million.

As the committal hearing progresses before Magistrate Malcolm Thomas, the case sheds light on the complexities of investigating cryptocurrency-related crimes and underscores the importance of upholding integrity within law enforcement agencies.

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