1 1 Pages 1 - 79 2 UNITED STATES DISTRICT COURT 3 NORTHERN DISTRICT OF CALIFORNIA 4 Before the Honorable Richard Seeborg Judge 5 UNITED STATES OF AMERICA 6 7 8 9 10 Plaintiff v SHAUN W BRIDGES Defendant _______________________________ APPEAL NO 15-10590 CASE NO 3 15-cr-00319-RS-1 San Francisco California Monday December 7 2015 11 00 A M Calendar 11 12 13 TRANSCRIPT OF PROCEEDINGS 14 APPEARANCES 15 For Plaintiff United States of America 16 17 18 19 20 21 22 KATHRYN R HAUN AUSA 450 Golden Gate Ave PO Box 36055 San Francisco CA 94102 RICHARD B EVANS AUSA DOJ Criminal Division Public Integrity Section 1400 New York Ave NW 12th Floor Washington DC 20005 For Defendant Shaun W Bridges 24 CRAIG Snell 50 W Reno 25 APPEARANCES CONTINUED ON FOLLOWING PAGE 23 DENNEY ESQ and Wilmer Liberty Street Suite 510 NV 89501 2 1 2 3 4 5 APPEARANCES CONTINUED For Defendant Shaun W Bridges STEVEN HALE LEVIN ESQ Levin and Curlett LLC 201 N Charles Street Suite 2000 Baltimore MD 21201 6 7 8 Reported by Kelly Polvi Contract Reporter 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 3 1 MONDAY DECEMBER 7 2015 11 04 A M 2 P R O C E E D I N G S 3 ---000--- 4 5 THE CLERK Calling case CR-15-319 United States versus Shaun W Bridges 6 Counsel please state your appearances 7 MS HAUN Good morning Your Honor Kathryn Haun for 8 the United States I'm joined by my co-counsel Richard Evans 9 from the Department of Justice's Public Integrity Section 10 MR EVANS Good morning Your Honor 11 MR LEVIN Good morning Your Honor 12 behalf of Mr Bridges 13 MR DENNEY 14 THE COURT 15 16 17 18 19 20 21 22 23 Steven Levin on And Craig Denney on behalf of Mr Bridges Good morning This is the time set for sentencing Has counsel had the opportunity to review the presentence report MS HAUN Yes Your Honor I'd like to turn this portion of the hearing to my colleague Mr Evans THE COURT Let me just get some preliminaries and then you can divvy it up however you would like to do it Have you had an opportunity to review the presentence report 24 MR LEVIN Yes Your Honor 25 THE COURT And have you had an opportunity to discuss Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 4 1 that with your client Mr Bridges 2 MR LEVIN I have Your Honor 3 THE COURT All right Let me just make clear what I 4 have reviewed I've reviewed the presentence report I've 5 reviewed the government's sentencing brief I've reviewed the 6 defendant's sentencing brief which attaches various 7 commendations received by Mr Bridges during his law 8 enforcement career as well as letters of support from former 9 Maryland Governor Ehrlich Mr Hutchins who apparently is a 10 former superintendent of the Maryland state police and 11 Mr Lawman a former Secret Service colleague of Mr Bridges 12 and then I've also reviewed the report that the defense has 13 submitted that was prepared by Dr Bloomberg 14 Okay Now Ms Haun you wanted to tell me something 15 MS HAUN Your Honor I just wanted to see how the Court 16 wanted to proceed today As the Court is aware we have a 17 victim here who's flown out here to make a victim impact 18 statement That's Mr Curtis Green 19 So just wanted to kind of take the -- 20 THE COURT Okay Well I will -- we'll get there Let 21 me do a few things first and then I'll tell you when would be 22 an appropriate time to hear from -- Mr Curtis you said 23 MS HAUN 24 THE COURT 25 MS HAUN Mr Curtis Green Mr Green Okay And Mr Evans is prepared to address a large Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 5 1 part of the arguments made in the government's sentencing 2 memorandum 3 before the government submits the matter 4 5 I also have a few points Your Honor to make THE COURT That is fine And you can divide up your discussion any way you want to divide it up 6 MS HAUN 7 THE COURT 8 Are there any factual objections beyond those that are 9 Thank you Let me first focus on the presentence report listed in the addendum to the report 10 MR EVANS Not from of the government Your Honor 11 MR LEVIN No Your Honor 12 THE COURT Okay Let me just go through those 13 Objections 1 through 4 pertain to various paragraphs in the 14 offense conduct section 15 the responses from the probation officer and I'm satisfied 16 with the responses from the probation officer as to his bases 17 for including the information I've read the objections I've read 18 And I therefore will overrule those objections 19 Objection No 5 goes to the two-level upward adjustment 20 21 for sophisticated means to be 1 1 b 10 C Mr Levin I'll hear from you But I have to tell you I 22 think it's fully warranted and unless there's something in 23 addition you want to present I think those two levels plainly 24 apply 25 MR LEVIN I think they do too Your Honor as a matter Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 6 1 of law but -- and I don't want to waste the Court's time with 2 this 3 addressed in the sentencing memo the fact that as a practical 4 matter -- perhaps not as a legal matter but as a practical 5 matter -- this wasn't particularly sophisticated 6 But I do want to at least emphasize which we've Mr Bridges set up a Mt Gox account in his name The 7 money was -- at the time Mr Bridges set up that 8 Mt Gox excha- -- account there were ceiling limits put in 9 place so that the nine or so transactions that occurred in the 10 two months that followed from Mt Gox to a fidelity account 11 were already set in place 12 Mr Bridges engaged in the conduct 13 They were automatic So At this point however this was passive conduct for 14 those two months 15 account in Mr Bridges's name and then ultimately 200 000 -- 16 or $250 000 was transferred to a bank account in his name and 17 that of his wife so that they could pay taxes 18 And the money was transferred to another That's really only -- the only point that I wanted to 19 make that there weren't additional efforts to hide his 20 identity 21 THE COURT I fear our definition of sophisticated is 22 quite different I think this is plainly sophisticated And 23 additionally the two levels would apply because I do think 24 there's activities through the Japanese account 25 you will Offshore if It's pretty clear to me that it's a -- to me it's a Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 7 1 2 sophisticated scheme Okay Our starting point as always is the -- has to be 3 the advisory sentencing guidelines which I find are correctly 4 calculated in the presentence report as a total offense level 5 of 25 a criminal history category of one and that yields an 6 advisory guideline sentencing range of 57 to 71 months 7 The government and the probation officer are recommending 8 a high-end sentence of 71 months the defense is arguing for a 9 custodial sentence of not more than 36 months 10 So that's where things stand 11 Let me look to the government to begin the discussion 12 MR EVANS 13 In addition to the guidelines calculation I want to Thank you Your Honor 14 point out the fact that as indicated in the presentence 15 report -- which was not objected to by defense -- that there 16 is -- the probation office found that there is no basis for 17 departure in this case 18 19 20 And we would agree with that that there are no identifiable grounds for departure And in defense's sentencing memo they've identified two 21 pursuant to the sentencing guidelines Section 5 h 1 3 22 regarding mental health and 5 h 1 4 regarding alcohol abuse 23 And I guess those are directed toward departures 24 And as we've said and as I think the presentencing 25 report points out that there are no departures that are Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 8 1 appropriate here 2 variance which is something different 3 4 5 They're essentially asking for a downward And we -- and the government Your Honor contends that there are no bases for a downward variance here either The thrust of defense's argument at this point is that 6 given the defendant's law enforcement career in -- whether it 7 was the county then the State of Maryland and Secret 8 Service -- and the fact that he's a first offender should 9 translate into a downward variance from the guideline range 10 Your Honor the government believes that neither of those 11 should merit any downward variance 12 offender role is taken into account by the guidelines the fact 13 that he's category one instead of some other category 14 extent that that's even an issue 15 In fact the first-time To the So what we're left with Your Honor is the 3553 a 16 factors to discuss in fashioning an appropriate sentence that's 17 appropriate in a case such as this 18 And Your Honor I think that the Court -- and as we've 19 made plain in our sentencing memorandum -- has to focus on the 20 nature and circumstances of the offense here 21 This was not just a pure theft This was not someone 22 stealing money from the till This was an agent a federal law 23 enforcement agent who was involved in a multi-agent -- 24 multi-agency task force that had been ongoing for years who 25 decided to steal bitcoins which he later converted to cash Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 9 1 from essentially the target of the investigation and lay the 2 blame for that theft on a cooperating witness 3 This was not a mere theft as defense counsel would like 4 this Court to believe 5 several cases which speak to that -- from courts outside of 6 this jurisdiction and outside the Ninth Circuit which would 7 support the idea that well in theft -- for theft cases the 8 guidelines are too high 9 And I know the defense pointed out That's not the case in this particular situation 10 Your Honor Although this was a theft the crimes to which 11 defendant pled to were money laundering related to wire fraud 12 under 1957 and obstruction of justice under 1512 13 So -- 14 THE COURT The obstruction of justice charge that is -- 15 in part goes to conduct once the law enforcement authorities 16 realized something was going on 17 Just go over with me again I know I reviewed it in the 18 context of certainly the entry of the plea but what is the 19 obstruction charge 20 MR EVANS What's the essence of it Your Honor the Court is correct There are 21 basically two components of the obstruction conduct here 22 one related to Mr Bridges's obstruction of the Baltimore 23 investigation of trying to determine who Dread Pirate Roberts 24 was and obstructing that investigation by stealing the 25 bitcoins by making that cooperator unavailable for future Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net The 10 1 cooperation 2 Basically they had to kill him off because of this 3 theft 4 himself 5 6 Which you'll hear more about that from the -- Mr Green So the obstruction of that investigation is one component 7 The obstruction on the second part is as to our 8 investigation of the criminal acts that were undertaken as part 9 of the task force related to Mr Mark -- Carl -- Force -- which 10 he was sentenced back in October by this Court -- as well as by 11 Mr 12 believe it was May of 2014 again in November of 2014 13 Bridges where he lied to federal agents back in -- I THE COURT The lie took the form in Mr Bridges's case 14 of suggesting that Mr Green was the one who actually had 15 stolen the bitcoin 16 MR EVANS Actually that Your Honor was as to the 17 first component I think basically when the theft came -- when 18 the theft occurred everyone focused on Mr Green because it 19 was done with his own -- 20 THE COURT His access 21 MR EVANS His access And no one on the task force 22 wanted to believe it was anyone else on the task force who had 23 done that so they all focused on Mr Green 24 they said You're trying to be a cooperator yet you're 25 stealing bitcoins And in fact You're not even going to get the benefit of Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 11 1 2 3 that cooperation So that obstructive conduct related to the theft of the bitcoins 4 The other obstruction came as to this grand jury 5 operating out of San Francisco who was investigating 6 corruption by the task force agents 7 interviewed by agents in Baltimore -- I believe it was in May 8 of 2014 9 in November of 2014 was questioned about various aspects of In fact Mr Bridges was Then in Washington D C about six months later -- 10 the Force conduct as well as possibly his own and lied to 11 federal agents during those interviews 12 He also lied to federal agents subsequently in March of 13 2015 just prior to pleading guilty regarding the -- his 14 interactions with another Secret Service employee who had done 15 FinCEN searches for him to figure out whether or not any SARS 16 had been issued with his name and as a result of the transfers 17 of funds to Fidelity and basically met with her before and 18 after her testimony -- her interviews with agents and her 19 testimony to the grand jury about telling a false consistent 20 story 21 So there was obstruction of the Baltimore grand jury 22 investigating the Silk Road and obstruction of the 23 San Francisco grand jury investigation investigating the agents 24 who we believe were corrupt at the time 25 THE COURT Well my understanding is that while they Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 12 1 interact at a certain point Mr Force and Mr Bridges are 2 engaged in if you will separate conduct in terms of the money 3 laundering and the theft activity 4 MR EVANS That appears to be the case Your Honor 5 THE COURT They're not doing that in conjunction or in 6 league with each other in any way 7 MR EVANS We've not revealed any evidence that would 8 indicate that You know in a small task force when you've 9 got corrupt agents one would think they would possibly talk 10 about that 11 that 12 were operating in separate silos doing it on their own 13 14 15 16 17 But we've not recovered any evidence to suggest And all we've got at this point is indications that they THE COURT But then they do come together with respect to Mr Green and that whole business MR EVANS They are Your Honor They were both involved in the arrest of Mr Green and his debrief Now Mr Bridges left that next day and did not attend 18 the second day of the debrief but that was after he had stolen 19 the bitcoins 20 and didn't want to be a part of it 21 22 I think he probably wanted to get out of there But yes Your Honor as far as the government knows at this point the evidence is they were operating independently 23 THE COURT Okay 24 MR EVANS Now Your Honor as we indicated in our 25 pleadings as well that this was not a -- this was not a single Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 13 1 act 2 a certain period of time when he withdrew bitcoins from various 3 accounts 4 Your Honor 5 internationally to Japan to Mt Gox and then over time 6 transfer those convert those to funds and transfer them back 7 into his Fidelity account 8 9 10 There was a theft that happened in one instance or over But that was not the only part of his crime here He then had to transfer those funds THE COURT There is a suggestion he does pay taxes on all that MR EVANS He apparently did pay taxes on it I don't 11 know if he was trying to you know make it so it's legitimate 12 that if anyone looked at that they'd say Oh he made money in 13 investing in bitcoins 14 had invested in bitcoins on his own 15 to further legitimize this to say Hey if someone looks at my 16 accounts they'll see I paid taxes on it 17 He was known to be an investor and he Maybe that was an attempt But the defendant had an opportunity many times along the 18 way to come in and to come clean and he didn't 19 interviewed in early May when the problems with Carl Force 20 happened prior to that when he was interviewed in November of 21 2014 and then later in the spring 22 told that charges were imminent that he came in and took 23 responsibility and pled guilty 24 25 When he was It was not until he was And even at that point Your Honor there were -- you know there were falsehoods that the defendant made to agents Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 14 1 2 investigating the corruption And the Court is aware of various other things along the 3 way in terms of post-plea agreement conduct in terms of 4 attempts to change names and Social Security numbers 5 these things have led to more and more restrictive 6 presentencing release conditions 7 him on rather restrictive conditions last fall after his -- 8 after his plea 9 All In fact the Court released We subsequently had another run-in with Mr Bridges back 10 in Baltimore in which the Court added further to the release 11 conditions basically confining him to his house under 12 electronic monitoring 13 THE COURT I'm not sure what we do with that though 14 Because to some extent that's addressed by the additional 15 restrictions 16 some extent I think cabined by that period of time and we 17 address it as we are required to do and could lead up to 18 custody pending sentencing 19 I mean those -- what conduct on pretrial is to But I'm not sure it's an independent -- this is a 20 question not a statement 21 factor to take into consideration or is it something that in 22 the moment needs to be dealt with in terms of what the release 23 conditions are 24 MR EVANS 25 Is it an independent sentencing Your Honor it's not necessarily a independent factor it's just a pattern of the conduct that I Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 15 1 2 wanted to bring to the Court's attention here This is not a case where the defendant as laid out in 3 his pleadings basically says when he was confronted he took 4 responsibility and there has tried to make it right since then 5 There have been additional things Whether it's the 6 weapons where he volunteered to turn over his weapons to 7 authorities that he owned -- which he did -- but then 8 subsequently his wife turned out -- presented the government 9 with a bill of sale from her attorney who claimed to have 10 bought them from her husband the day he was out here for a 11 dollar and that they now belong to her 12 And then only when we raised issues about the legality of 13 such a sale of the type of weapons involved did the request 14 for those to be returned to his wife as opposed to him kind 15 of go away 16 There's just a series of things here Your Honor which 17 cause the government concern about his overall truthfulness and 18 so forth 19 20 21 THE COURT Some of those issues might be addressed in terms of the self-surrender issues MR EVANS Well that's just it Your Honor That's one 22 of the things the government was going to be asking for today 23 And just wanted to point out that this is not an instance 24 where he stole something once when confronted he confessed 25 and that was it There's been a pattern of deception here Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 16 1 that's gone on for years 2 or months Your Honor 3 And it's not just a matter of weeks Your Honor this is one of those cases as well that -- 4 many of the cases that we deal with in public corruption 5 specific deterrence is not necessarily an issue 6 individual former contracting officer or something like that 7 they're not going to be in that position again 8 9 10 11 12 The The specific deterrence issue is not as big of a factor it's more general deterrence This Your Honor is a case we believe that both specific deterrence and general deterrence are important factors As I indicated just previously there's a pattern of 13 conduct here with the defendant that we find troubling and is 14 one of reasons we're going to be asking the Court to remand the 15 defendant into custody after sentencing this morning 16 But Mr Bridges was involved in numerous investigations 17 in numerous seizures of bitcoins of other digital currency 18 which Your Honor we have no -- in some of these cases have 19 no indication of where those currencies have gone the extent 20 of those seized and so forth 21 questions There are a lot of unanswered 22 And one of the reasons why his -- 23 THE COURT Your suggestion is that -- I'm not sure I 24 follow you -- that -- is that simply because the government 25 isn't in a position to have a handle on what some of the Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 17 1 conduct -- their own agent's conduct has been 2 certainly not going to take the assumption that there's all 3 sorts of purloined funds out there floating around and 4 Mr Bridges may someday have access to it if that's what 5 you're suggesting 6 MR EVANS I mean I'm Your Honor my point is only that -- as part 7 of the release conditions that Mr Bridges is currently under 8 is he can't even access -- he's not permitted to access 9 computers at this point in time 10 11 And that's for a variety of reasons But the point here is Your Honor this individual has 12 expertise in digital currency in dark websites and has had 13 access to these types of cases and has been involved in 14 seizures 15 16 17 18 19 20 21 And that's one of the issues that my colleague will address But the impacts of his conduct go well beyond this case and affect many other cases And the specific deterrence component is still here with Mr Bridges I believe as well as the general deterrence Other law enforcement other government officials have 22 to know that if you undergo or if you undertake this type of 23 conduct that if you steal from the targets of your 24 investigation to line your own pockets there's severe 25 penalties that you'll be facing so that in addition to the Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 18 1 specific deterrents as to Mr Bridges -- I know defense counsel 2 says that he's learned his lesson he's not going to be back 3 before any Court -- I don't feel fully confident of that 4 Your Honor 5 take into consideration as well as the general deterrence 6 factor 7 8 9 In fact I think it's a concern the Court should Now in terms of the downward variance -- my colleague will address the Court on the issue of the mental health But Your Honor I just want to say about the alcohol 10 abuse that's raised This is not -- as the guidelines discuss 11 this is not ordinarily a reason for a downward departure 12 Again we're talking departures under 5 h 1 4 13 To the extent that Mr Bridges needs alcohol treatment 14 the Bureau of Prisons is well equipped to provide that type of 15 treatment throughout his incarceration 16 And my colleague will address the mental health issues at 17 this point a couple of other items that the Court should be 18 aware of 19 THE COURT 20 MS HAUN Okay Ms Haun Thank you Your Honor I wanted to mention 21 three things and three reasons why I really believe that the 22 Court should impose a high-end sentence here 23 The first is just the breathtaking abuse of trust that 24 the government and that the public has suffered at the hands of 25 Mr Bridges Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 19 1 One thing I've been clear to report to the Court -- 2 Mr Bridges and his lawyer already know this of course -- but 3 I'm authorized to share with the Court that as a member of the 4 Secret Service Mr Bridges served a joint-duty assignment with 5 the National Security Agency Your Honor during the time frame 6 of these events that led to this case 7 So I'm not sure if Your Honor was aware of Mr -- 8 THE COURT 9 report 10 MS HAUN 11 THE COURT 12 13 I think it's actually in the presentence memoranda Okay Well Your Honor -- Or it was perhaps in the sentencing But I was alerted to that MS HAUN Okay So as part of this joint-duty 14 assignment with the NSA of course Mr Bridges had to fill out a 15 routine background check and part of those questions ask if 16 there's any mental health issue 17 responded to negatively 18 And the queries were always In addition Mr Bridges as part of Secret Service was 19 charged with guarding members of the First Family Again 20 during the time frame here in this case 21 items of discovery that was provided to defense counsel in this 22 case was a series of text messages in which Mr Bridges engaged 23 with another member of Baltimore Silk Task Force an IRS agent 24 and the two of them were routinely talking about their trading 25 how much money they were making in the market In fact one of the Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 20 1 2 3 This is unclear if it was with the proceeds of the crimes in this case While all the way Mr Bridges throughout this text 4 messages is telling this other IRS agent Hey I'm guarding 5 Mrs Obama right now 6 While he's making these trades So I think aside from the fact that there's no indication 7 until now until the prosecution of this case that Mr Bridges 8 has some mental defect there's no -- there's never been a 9 suggestion throughout Mr Bridges's somewhat lengthy career 10 with the Secret Service -- and certainly with law 11 enforcement -- that he was suffering from a mental defect 12 So I think any kind of departure for those reasons is 13 inappropriate 14 the case of Mr Force 15 had some suggestion of mental health issues during the time 16 frame of the events in question of his case 17 For the same reasons were in inappropriate in Who at least in the case of Mr Force The reason I raise the NSA and guarding the First Family 18 is again this is an agent with the Secret Service a federal 19 agent 20 said that it was a simple one-off theft 21 22 23 24 25 And the way he abused the public trust it cannot be And by the way even if it was a one-off theft a one-off theft by a member of a federal task force is one too many Which brings me to my second reason Your Honor that I think that a high-end sentence is merited here The number of cases that Mr Bridges contaminated not Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 21 1 just existing criminal cases but also investigations across 2 the country that his conduct has led to have to be shut down 3 is truly staggering 4 We start here -- there was a criminal investigation that 5 another district had into Mt Gox that's had to since be shut 6 down 7 8 9 THE COURT And your position is the shutting down of those is entirely ascribable to the conduct of Mr Bridges MS HAUN I won't make representation it's 100 percent 10 Your Honor 11 investigation I don't know whether other factors would have 12 ended up shutting it down as well 13 Because of course it was in early stages of But I can tell you that Mr Bridges learned that there is 14 a criminal investigation afoot with respect to Mt Gox 15 what did he do 16 office and did a civil seizure warrant of accounts belonging to 17 Mr Karpeles who was at that time the head of Mt Gox 18 19 20 And He turned around with an AUSA in the Baltimore But before he did that two days before he did that he made sure to get all of his own money out The government's theory is that one of the reasons he did 21 this seizure warrant Your Honor is because he didn't want a 22 criminal case to proceed because if the US government ever got 23 Mt Gox records they might see his own name on them 24 25 But that's just one example I can tell you from my own knowledge that in this district a number of investigations have Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 22 1 had to be shut down directly -- directly a hundred percent 2 because of Mr Bridges 3 digital currency expert he would fly across the country and 4 consult in different jurisdictions out on the West Coast up in 5 Oregon back on the East Coast 6 help and advice to other Secret Service agents and other 7 federal agents 8 9 10 And that's because in his role as a He flew all over offering his As a result of his name now being on those investigations they have had to be shut down So I think that's another factor 11 Again even if it's one theft it's one theft too many 12 And the third reason Your Honor is because of the way 13 that Mr Bridges set Mr Curtis Green up entirely to take the 14 fall 15 And you'll hear today from Mr Green himself But one of 16 the things Mr Green is going to tell you is how Bridges 17 himself was so intent during the proffer -- now of course 18 Green -- Mr Green was flipped 19 with the government 20 agents who he thinks he can trust 21 determination he's going to come clean and he wants to 22 cooperate with the government 23 He was going to cooperate So here he's sitting in a room of federal He's made the early And he'll tell you about how Mr Bridges was so insistent 24 on learning exactly how to log into to his -- using his 25 administrative account and passwords and he'll tell you also Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 23 1 that Mr Bridges didn't just simply transfer approximately 2 21 000 bitcoins out to steal them he transferred them to 3 Curtis Green's account 4 because he wanted to have a suspect 5 -- we know is Russ Ulbricht he wanted other Silk Road vendors 6 and users to know Here's the person who stole my 1 000 7 bitcoins 8 9 And the reason why Your Honor is He wanted DPR who's now It's Curtis Green Curtis Green is going to tell you about the over 30 death threats he had He's going to describe to you firsthand how he 10 was housebound for a year Your Honor and how he's been in 11 fear for his life 12 hit teams 13 Federal Baltimore Agent Task Force but another one of those 14 hit teams Mr Green will tell you about and he'll also tell 15 you about how he was threatened and told he would not be 16 getting a 5K a sentencing reduction because the prosecutor and 17 the other agents felt he was lying because certainly his own 18 credentials had been used to move 21 000 bitcoins Because of course Russ Ulbricht put out two And one of the hit teams turned out to be the 19 And I think together with the reasons that my colleague 20 Mr Evans addressed Your Honor this case undoubtably merits 21 a high-end sentence 22 And on that I would submit 23 THE COURT 24 I will hear from Mr Green at this point and then turn 25 Thank you to the defense Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 24 1 2 Mr Green if you could come forward Come forward to the podium sir 3 For the record if you could give us your name 4 MR GREEN Curtis Green 5 THE COURT Very well 6 MR GREEN Is it okay if I have Ms Haun stand next to 8 THE COURT Oh sure 9 MR GREEN You'll have to excuse me 7 10 me Sure I get nervous and I just want to have her so she can keep me on the path 11 THE COURT I recognize it's an intimidating place 12 MR GREEN Very much so 13 MS HAUN And Your Honor just for the record Mr Green 14 is represented by criminal counsel in this case out in 15 Salt Lake City Utah and both of them were unable to travel 16 here today but asked that Mr Green come and speak for himself 17 THE COURT Very well 18 So you may proceed Mr Green 19 MR GREEN Okay I guess I'll start back with the 20 proffer arrangement I had 21 Secret Service building with -- oh approximately -- I couldn't 22 tell you 15 20 -- what I was told was pretty much the entire 23 Baltimore Silk Road Task Force 24 25 It was actually located in the And they obviously offered me a proffer agreement with an attached -- I don't want to get too much -- 5K I'll leave it Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 25 1 2 at that And during the -- during the proffer agreement they 3 started out asking standard questions 4 involved you know just the basic you know things 5 And one of the things that -- 6 THE COURT 7 talking to you 8 MR GREEN There was -- 9 THE COURT Was Mr Bridges 10 MR GREEN Oh absolutely You know how did I get Which agents were there when they were He sat I believe right 11 across -- in fact where this lady is sitting 12 exact same distance Almost the 13 I lost my train of thought again 14 And so they offered -- in the proffer agreement they told 15 me that you know as long as I told the truth and 100 percent 16 the truth nothing could be held against me So obviously I 17 made sure that I told 100 percent the truth Every question 18 that they asked I answered 100-percent truthful 19 far as I knew it obviously 20 21 22 I mean as Anyway after getting -- and we started and we got to the you know how to log in I showed them how to log in And the agents were just taking notes and asking simple 23 questions Mr Bridges kept on asking me how to get in and 24 asking me specifics on how to -- How do you change that 25 password And I actually turned my computer towards him to Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 26 1 actually show him since he was -- to show him exactly how to 2 do it 3 later on right before he left to go move the bitcoins he 4 asked me to show him one more time and -- just to make sure 5 that he knew exact- -- because it was fairly com- -- you know 6 fairly complicated 7 And I think I showed him more than once He set me up to take the fall And in fact And what that did was 8 he -- he wanted DPR Russ Ulbricht to make sure that it was me 9 that did it And he knew that -- DPR knew who exactly who I 10 was And DPR Russ Ulbricht had obviously millions -- if not 11 hundreds of millions -- of dollars at his disposal 12 know when you're dealing with a criminal you know you could 13 definitely put you know my life in danger Which you 14 And he also purposely put -- when he moved the bitcoins 15 he moved them into my account so it really looked like I did 16 it 17 no-brainer saying Oh obviously he did it 18 19 I mean anybody looking into it would -- it would be a And so he was very calculated It was very well thought out in my opinion 20 And also you know I can't tell you how many -- how many 21 death threats I've received More than 30 and probably less 22 than 200 23 would do to my grandchildren in very -- in great detail 24 was very specific 25 it One -- one death threat specifically told what they It Which you -- I didn't want to ever repeat Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 27 1 Fortunately I only got one of those terrible -- I mean 2 obviously all of them were bad 3 their full names middle names addresses 4 5 6 7 8 9 10 11 12 He named my grandchild with And so you can imagine the mental stress and anguish that it put me through Not only that I was essentially basically -- I guess you would call it -- self-imposed house arrest Carl Force was one of the guys that Russ Ulbricht happened to hire to kill me And then we faked my death took photos and -- very realistic and sent them in And there was also a -- there was actually a second group 13 that was -- that was hired to kill me 14 had two two different groups that were supposed to kill me and 15 my family 16 recently 17 So I actually had -- I And I didn't even know about the second group until I'm so fortunate that so far nothing has happened You 18 know they could kill me but they still want to hurt my 19 family 20 year almost a year 21 leave -- it was about a 30-foot radius to my kitchen and I had 22 a bathroom in my room 23 drawn 24 25 And like I said I was -- I was house-bound for a Ten eleven months I believe I didn't I had to have all my -- my blinds And Carl Force called me on a daily basis to make sure that I was keeping low not going out Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 28 1 And I also -- and the one thing -- I don't even know if 2 Ms Haun knows but Carl one day called me and he said 3 You'll be -- you'll be receiving a call from Shaun Bridges 4 Tell him whatever he needs to know 5 6 And I'm like sure the good guys I'm helping you know These are They're there to protect me which I thought 7 And obviously I was just totally wrong 8 And he did call me and we -- he talked about bitcoin and 9 I educated him I'm -- unfortunately I wish I would have 10 never got involved in bitcoin to be honest with you But I 11 educated -- you know thinking I was helping the government I 12 educated Mr Bridges and Carl Force on how bitcoin worked how 13 to move bitcoin how to essentially hide it 14 And that's the one thing that I -- knowing bitcoin as 15 well as I do I mean I would consider myself an expert in 16 bitcoin because I've been there since the beginning bitcoin is 17 extremely easy to hide 18 my -- on a thumb drive in my pocket right now and you know 19 unless you put it in there and on a computer you know -- 20 I could have a billion dollars in So when I heard them saying that is there other money 21 the bitcoins you know I can't speculate I don't want to 22 speculate 23 extremely easy to hide 24 25 Okay But I just -- to let you know it is extremely And the other thing that I was you know I would say I was given a 5K And when they thought that I -- when Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 29 1 they discovered that all the bitcoins had been moved I was 2 immediately accused 3 screaming at me -- the AUSA 4 all the same 5 Immediately We know you did it 7 the side and say Come on 8 9 Yeah The AUSA would -- Come on 6 The attorney general I'm sorry To me they're You -- we know you stole it And then another agent would pull me to They're the bad guys you know And I kept on saying I -- I wish I could you know And I kept on saying It doesn't make sense for me to steal 10 the money the bitcoins 11 would I steal it the night that I am in front of 15 agents 12 I -- wouldn't I have done it the week before in the comfort of 13 my home 14 If I was that type of person why It just made no common sense to me whatsoever and I 15 couldn't believe that they were accusing me 16 just because there was -- anyway 17 Okay Yeah It blew my mind And they were like they were going to 18 take my 5K away from me Herring -- Herring said -- said We 19 are going to take -- you know we don't think you're telling 20 the truth and since you lied to us we're going to take that 21 away And that blew me away 22 And I begged them for a lie detector test 23 And Bridges -- not Bridges Force kiboshed every time 24 25 that But yeah that was -- the 5K reduction was -- until they Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 30 1 2 found the real culprit that 5K was taken off the table And finally I was vindicated and proved that I did not 3 steal that money because that money turned -- I think by the 4 time they turned it in it was close to a million dollars 5 instead of at the time it was 300 000 I believe 6 turned into a million Now it 7 So anyway -- I think -- oh one more thing I want to say 8 You know Mr Bridges being a federal agent I believe needs 9 to be held to a higher standard His crime definitely was not 10 victimless 11 emotional and physical pain that it has caused me 12 and gained 120 pounds two times since this has all happened 13 have been diagnosed with post-traumatic stress disorder and am 14 seeing a psychologist for that 15 ironically the other guy that was kind of helping them kill me 16 was just arrested three days ago which his name was Variety 17 Jones 18 real name 19 that he's now in custody because he was the other person that 20 really wanted me dead and who was helping you know 21 just hope that you know I can now get my life back into 22 order 23 24 25 I am trying -- I am still trying to deal with the That's his pseudonym I've lost I And now that they -- just Thomas Clark I believe is his And that kind of gives me a little comfort knowing And I And like I said this is definitely not a victimless crime and what I went through was literally literal hell And thank you Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 31 1 2 THE COURT Thank you Mr Green Thank you for coming forward 3 Mr Levin 4 MR LEVIN Thank you Your Honor We have two people 5 who have flown here from Maryland that would like to briefly 6 address the Court 7 THE COURT Well generally I don't have people 8 addressing the Court other than counsel and the defendant 9 Who are these people 10 MR LEVIN One is a former supervisor 11 THE COURT That's why you submit material to me in 12 advance 13 provide character evidence orally 14 I don't generally have hearings where people come and MR LEVIN This was referenced in one of the filings 15 that we submitted to the Court that we indicated Ms Barbara 16 Golden would be testifying 17 Counsel 18 19 20 THE COURT There was no objection to that by Well it's not how I generally proceed And I was not -- I don't recall where you told me that MR LEVIN It was filed in a court hearing where there 21 was some suggestion that Mr Bridges was reporting a theft of 22 his wallet and backpack and we indicated part of our argument 23 that of course he was going to be here for sentencing because 24 he had made arrangements for Ms Barbara Golden to speak on his 25 behalf Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 32 1 THE COURT So that's buried in something It's not in 2 your sentencing memorandum 3 I'm preparing for this hearing 4 some prior pleading somewhere that I'm supposed to go back and 5 find 6 7 8 9 That's what I'm looking at when So to expect me -- this is You're making a passing reference to this I mean you need to tell me in advance what your plan is Because quite frankly that's not how I generally proceed Now I will allow you to call -- very brief -- allow people to come up -- hopefully it's a controlled number 10 How many people are you proposing to bring up 11 MR LEVIN 12 13 Here We have Ms Golden and Mr Bridges's wife who has a very short statement THE COURT Well again I get this material in written 14 form and I spend a great deal of time with it and I review it 15 But our sentencing in this district doesn't usually involve 16 character witnesses orally providing input 17 18 19 MR LEVIN I understand that And I do apologize I hope the Court will not hold that against Mr Bridges THE COURT I'm not going to hold it -- certainly not 20 But I'm not pleased that this is how you're proposing to 21 proceed at this point 22 But go ahead 23 MS HAUN Your Honor we don't have a problem with 24 Ms Golden although we've had no notice of this either 25 However with respect Ms Esposito who became Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 33 1 Mr Bridges's wife during the pendency of this case we have 2 some concerns particularly as it concerns the grand jury 3 process and some privileges she's invoked before as well as we 4 have some background that we could then provide 5 THE COURT Well that's why I'm -- this is not a trial 6 proceeding where witnesses are -- credibility is being 7 impeached That's why we don't do it this way 8 MS HAUN 9 THE COURT Right However I assume that the statements -- any 10 statements that are going to be made are going to be very 11 limited to sentencing factors and not going into anything that 12 perhaps would be of concern if I understand your point 13 MS HAUN Well I think Your Honor then the Court 14 should be aware that one week Ms Esposito was subpoenaed to 15 the grand jury she was not Mr Bridges's wife they had been 16 together for approximately three years as the government 17 understands it 18 scheduling issue 19 the grand jury could accommodate her one week later 20 so 21 then invoked spousal immunity 22 23 She asked for a week reprieve because of a She asked the government and the agents if We did In the intervening weekend she married Mr Bridges and I think whatever comments Ms Esposito shares with the Court the Court should have that background in mind 24 THE COURT Very well 25 MR LEVIN She actually did not invoke marital privilege Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 34 1 initially 2 fly out here twice Your Honor and spoke to the agents 3 when they threatened to prosecute her and call her before the 4 grand jury -- because they simply didn't believe her -- that's 5 when on advice of her counsel she invoked marital privilege 6 She was willing to fly out here twice and she did THE COURT This is not Ms Esposito's case this is 7 Mr Bridges's 8 factors pertaining to him 9 that if this had been presented in an appropriate fashion 10 Only So I want the focus to be on the sentencing This is one of the reasons again perhaps these issues could have been fleshed out 11 But let's proceed 12 MR LEVIN Thank you Your Honor 13 THE COURT Are you proposing to have these people talk 14 to me before you present your discussion 15 16 MR LEVIN Yes Your Honor if that's okay with the Court 17 THE COURT All right 18 MR LEVIN Thank you 19 Ms Barbara Golden 20 MS GOLDEN 21 THE COURT 22 Thank you Your Honor Good morning If you could give us your name 23 MS GOLDEN 24 MR EVANS 25 Go ahead Barbara Golden Your Honor just inquiring whether the witnesses are going to be placed under oath Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 35 1 THE COURT No That's -- no I would be receiving this 2 in the letter form which is how I would have preferred it 3 that's how I am going to be receiving it 4 Go ahead 5 MS GOLDEN 6 Your Honor I've spent my entire adult life in the law So Thank you 7 enforcement community specifically a 37-year career with the 8 U S Secret Service 9 privileged to be selected as the special agent in charge of the 10 11 I rose through the ranks and was Baltimore field office When I reported to this position in 2007 the office was 12 understaffed and overworked with both investigative and 13 protective assignments 14 Then-President Bush spent almost every weekend at Camp 15 David then-Vice President Cheney spent weekends at a home in 16 St Michaels Maryland both of which required significant 17 manpower 18 to increase the staffing in the Baltimore office 19 these additions were agents transferring from protective 20 assignments in Washington D C but a majority were new hires 21 applying for a special agent position 22 I was able to justify to our headquarters the need Some of As the special agent in charge I had a great amount of 23 say in who would either be assigned or hired in Baltimore 24 was very involved in the hiring process and conducted both 25 one-on-one initial interviews and three-member panel Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net I 36 1 interviews 2 Bridges in 2009 3 The latter was the occasion in which I met Shaun This involves three agents asking the applicant 20 4 pre-selected questions some being situational scenarios 5 others straightforward 6 I recall Shaun first describing his career with the 7 Maryland State Police He was a decorated trooper a member of 8 the Fugitive Task Force and an instructor at the state police 9 academy His desire was to further his career in law 10 enforcement and to become a federal agent 11 next hour conducting the panel interview 12 We then spent the Shaun never hesitated in his answers he was confident 13 but never cocky he brought to the table past experiences as a 14 trooper which helped form his answers to the questions 15 presented and he was very engaged with all three agents under 16 the stressful situation 17 law enforcement professional He struck me as a loyal and caring 18 Several months following the panel interview Shaun was 19 approved for the special agent position he had applied for 20 was instructed to offer Shaun a position in one of four cities 21 New York Jacksonville St Louis or Cleveland 22 excited for this opportunity Shaun explained he would suffer a 23 significant loss on a sale of his current residence 24 that argument to our headquarters cited the current workload 25 the office was experiencing and the fact that I was very I Although I took Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 37 1 impressed with Shaun and wanted him on my team 2 have Shaun assigned to the Baltimore field office 3 I was able to Shaun immediately went through the extended training 4 requirements both at the federal law enforcement training 5 center in Glenco Georgia for approximately 12 weeks and the 6 Secret Service rally training in Laurel Maryland for another 7 16 weeks 8 class of 24 trainees in the academic category which I 9 witnessed at his graduation There Shaun excelled and was named first in his 10 Again I was very impressed with Shaun 11 Shortly after graduation I had had occasion to speak with 12 the commandant of the Maryland State Police Colonel Terry 13 Sheridan 14 decorated troopers 15 trooper class 16 instantly knew and recited Shaun's accomplishments with MSP 17 Inside I was gloating that I had hired one of his Shaun was ranked number one overall in his Colonel Sheridan acknowledged his loss and I believe this sparked a thought in Colonel Sheridan that 18 he had also lost an instructor at this academy Colonel 19 Sheridan soon launched an effort to borrow Shaun to continue to 20 teach criminal law at their MSP Academy 21 from the commander of the MSP Academy requesting Shaun be 22 allowed to continue instructing 23 partnership and liaison with the Maryland State Police that 24 request was granted 25 Shaun I received a letter To continue my professional And this only added to my confidence in Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 38 1 Over the course of Shaun's career with the Secret Service 2 he taught approximately ten Maryland State Police Academy 3 classes totaling approximately 500 troopers 4 interfere with the demands placed on him by the service 5 he continued to meet and balance every protective and 6 investigative assignment with enthusiasm 7 Not once did this And During this juggle of assignments and shortly after Shaun 8 began his Secret Service career he went through a divorce 9 which was emotionally devastating Shaun volunteered for 10 protection assignments in an effort to keep busy 11 his cases diligently and never complained 12 He worked Shaun is an emotional person and at times it was evident 13 that this divorce deeply hurt him 14 excuse to avoid his responsibilities he met each and every 15 one 16 But he never made this an In early 2011 Shaun expressed an interest in and attended 17 the Secret Service Electronic Crimes Special Agent Program 18 which trains agents in computer forensics and electronic crimes 19 investigations 20 also made the most significant seizures in the Baltimore 21 office 22 cases and made three large seizures from China totalling 23 several thousand dollars which no one to my recollection had 24 ever done 25 Shaun easily excelled in this field Shaun He was the only special agent to work counterfeit coin Shaun began working on the Silk Road investigation as an Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 39 1 offshoot of the counterfeit coin investigation which now 2 involved virtual currency known as bitcoins 3 grasp on the concept of virtual currency Shaun was asked by 4 the FBI to sit on their virtual currency working group at the 5 FBI headquarters 6 request and Shaun attended monthly meetings offering advice 7 and sharing intelligence Because of his Shaun's first-line supervisor approved the 8 Another request for Shaun's assistance came from the 9 Department of Justice's Asset Forfeiture Money Laundering 10 section in Washington DC 11 Service on this committee to provide guidance on seizures 12 relating to virtual currency 13 Shaun was to represent the Secret This was again approved by Shaun's first-line 14 supervisor with my blessing but it was rescinded by our own 15 headquarters after just a few meetings 16 supervisor above me did not feel it appropriate for a GS-13 to 17 sit on a panel of this caliber yet no substitute of a higher 18 grade was made that I'm aware of 19 It is my belief that a Shaun's expertise continued to be sought after by the FBI 20 and he accompanied a Baltimore supervisor along with Secret 21 Service Deputy Assistance Directors to the FBI headquarters to 22 brief FBI Assistant Director Demarest on the current status of 23 virtual currency 24 25 This meeting occurred following my departure from the Baltimore office but I can attest to the multiple seizures Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 40 1 Shaun made involving virtual currency 2 several million dollars which made the GS-15 Baltimore field 3 office number one service-wide 4 These seizures totaled With regard to comments made by the government in their 5 sentencing memo about Shaun leaving one of his computers in a 6 wipe area in our computer lab I can attest that no Secret 7 Service-issued equipment is ever randomly or deliberately wiped 8 clean by an agent or a police officer that is assigned to that 9 lab Work stations are barely delineated due to the size of 10 the lab itself 11 forensic equipment -- cables disks et cetera -- which Shaun 12 obviously knew having been assigned to the lab since 2011 13 Evidence that is to be examined by a trained forensic 14 technician must be accompanied by a request from an agent or an 15 agency with instructions as to what type of evidence they're 16 seeking whether it be credit card numbers distinct 17 trafficking in credit card numbers child pornography or 18 whatever type of case is being investigated 19 suspect computers are labeled as evidence and maintained as 20 such in a locked vault as is the computer lab 21 Overhead cabinets are utilized for storage of Hard drives from To my knowledge there was a small area that was not 22 someone's work space where hard drives or computers were set 23 aside and were labeled or marked in some way indicating they 24 were ready to be wiped 25 prosecutor at the end of all judicial action or a supervisor Approval to do so came from either a Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 41 1 before any suspected equipment was returned in a nonjudicial 2 investigation 3 No one without instruction just randomly wiped computers 4 in the computer lab as there is a priority to ensure that no 5 one did -- that no one did wipe a computer by accident for 6 obvious reasons 7 Service property number would never be wiped in the lab by 8 either a special agent or an officer assigned to that lab A Secret Service computer bearing a Secret 9 Since the computer that Shaun placed in the computer lab 10 was utilized by him for his computer forensic investigations 11 it was the most logical decision to place it in that lab 12 Other agents would recognize the equipment as Secret Service 13 property and know that its purpose was for computer forensic 14 investigations 15 Prior to his retirement from law enforcement Shaun did 16 an extraordinary job as a Secret Service agent and I was proud 17 to have him on my team and on my side 18 hell past year but I know he is at least in part relieved to 19 be able to start the rehabilitation process 20 a chance to prove himself once again 21 THE COURT 22 Mr Levin 23 MR LEVIN 24 25 He has been through I pray he's given Thank you Thank you Your Honor If it's okay with the Court Ms Esposito has a much more brief statement THE COURT Very well Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 42 1 MR LEVIN Thank you 2 THE COURT Good morning and if you could give us your 3 4 name MS ESPOSITO All right Arianna Esposito I would 5 like to thank this Honorable Court for giving me the 6 opportunity to speak on my husband's behalf 7 that Your Honor has heard from countless mothers fathers 8 spouses and children of the defendant pleading for mercy for 9 their loved one and as such what I have to say may not seem I acknowledge 10 different in the Court's eyes 11 capability of offering before you today is to share with you 12 the truth about my husband 13 However all I have the The truth is my husband -- my husband's contributions to 14 law enforcement within our state are extraordinary and such is 15 acknowledged before this Court by the honorable governor 16 another former superintendent of the state police and former 17 head of the Secret Service for the State of Maryland who is 18 present in this courtroom today 19 than a decade devoting himself to the citizens of Maryland and 20 has been recognized for saving lives on countless occasions 21 My husband has served in many capacities of law enforcement 22 within our state 23 hostage negotiator where he successfully negotiated the safety 24 of many adults and children over the years who would not be 25 here today if it was not for his actions of courage My husband has spent more One of those such capacities was as a He has Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 43 1 received a plethora of commendations ranging from bringing to 2 justice some of the most violent fugitives to placing himself 3 in the midst of gunfire to save the lives of innocent 4 bystanders 5 It is easy for us to forget all that he has sacrificed 6 and instead judge him based a single spontaneous act that 7 snowballed 8 actions 9 brought against him My husband has accepted responsibility for his And over two years passed before any charges were During the years that passed after this 10 incident my husband was not involved in any wrongdoing other 11 than that which has connected to the original incident 12 shows that the theft was out of the ordinary 13 engaging in other wrongdoing my husband in the following 14 years received commendations and rose to positions in greater 15 responsibility due to his work ethic and dedication to the 16 citizens of our state 17 This And instead of I make no excuse nor does my husband for his actions 18 He has accepted responsibility and will forever live with the 19 consequences of his actions 20 sentencing my husband that you take a holistic approach 21 taking all of these facts into consideration and that 22 sentencing my husband for a long period of incarceration does 23 nothing but victimize me further I ask you to move forward in 24 I understand Your Honor is outraged by my husband's 25 conduct and as such he shall and will pay a heavy price for Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 44 1 the rest of his life as he has already lost everything 2 husband has already learned from his mistake and I 3 respectfully request that you consider such in determining his 4 sentence and possible leniency Thank you 5 THE COURT 6 Mr Levin 7 MR LEVIN 8 Your Honor I wasn't planning to address Ms Green's 9 10 11 My Thank you Thank you Your Honor comments first but I think I have to because they may color the entire proceeding and I think it's worth noting First of all it's terrible what Mr Green has been put 12 through I don't think anybody doubts that And the death 13 threats are inexcusable and outrageous 14 the death threats are a result of the fact that Mr Ulbricht 15 learned that Mr Green was cooperating 16 Mr Green allegedly had stolen bitcoins However Your Honor They are not because 17 THE COURT How do we know that 18 MR LEVIN Well Your Honor if I may I have a chat 19 between Russ Ulbricht and Carl Force 20 after -- 21 THE COURT And this is shortly I have to tell you quite honestly I don't 22 think that is particularly significant It could have exposed 23 him to very serious threats and consequences 24 it actually is the motivation behind the threats okay I'll 25 assume for purposes of discussion it isn't the direct Whether or not Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 45 1 motivation 2 that it put Mr Green in harm's way 3 4 But you're not disagreeing with the simple fact MR LEVIN I'm not disagreeing with that at all Your Honor 5 THE COURT So whether or not the threats that he 6 actually received emanated from the understanding that 7 Mr Ulbricht reached that he was cooperating or because of the 8 theft I'm not sure is of great consequence 9 MR LEVIN But go ahead Well candidly Your Honor I feel like the 10 Court's being misled when it is told that because of the theft 11 Mr Ulbricht wanted to kill Mr Green 12 true 13 shortly after the theft Mr Ulbricht writes to Mr Force -- 14 This is Ulbricht 15 meaning Mr Green -- to return the stolen funds that would be 16 be amazing 17 18 In fact in a chat between Mr Ulbricht and Carl Force Mr Force clear If you can get someone to force him -- Personally I don't want any contact Mr Ulbricht 20 Mr Force 22 What do you mean Do you want him beaten up shot just pay the visit Mr Ulbricht I'd like him beaten up and forced to send 23 the bitcoins he stole back 24 make him do it 25 I'm If you want something done I can help you discreetly 19 21 That is simply not Then he writes Sit him down at his computer and Beat him up only if he doesn't comply I Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 46 1 guess 2 It's only later when Mr Ulbricht learns -- because 3 local law enforcement in Utah disclosed the fact publicly that 4 Mr Green had been arrested -- that Mr OL brick learned of 5 the arrest and worried that he was cooperating and that's when 6 Mr OL brick writes to Carl Force 7 a while and now that he's been arrested 8 give up information 9 to have him murdered 10 He was on the inside for I'm afraid he'll And that led to Mr OL bright wanting It's inexcusable what Mr OL brick did it's inexcusable 11 that Mr Bridges stole the bitcoins but frankly Your Honor I 12 think the Court's being misled when it's told that the threats 13 of murder were a result of the stolen bitcoins 14 THE COURT Is also inexcusable for a federal agent to 15 put a cooperating witness in that kind of situation whether or 16 not anybody acts upon it It's utterly inexcusable 17 MR LEVIN We're not disagreeing Your Honor 18 THE COURT Well then I understand your point that I 19 need to take it into context and realize other things were 20 going on 21 And I take your point MR LEVIN And we heard today that bitcoins were 22 transferred to Mr Green's account This is the first we're 23 hearing it 24 that that's accurate that Mr Bridges somehow transferred 25 bitcoins into Mr Green's account That's not in the plea agreement I don't know We know from charts that Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 47 1 were attached to the criminal complaint that Mr Bridges stole 2 bitcoins and transferred them to Mt Gox 3 So today's the first time I'm hearing -- and we object to 4 it -- any suggestion that Mr Bridges transferred bitcoins to 5 Mr Green's account 6 And today is the first day first time I'm hearing that 7 Mr Bridges lied on May 28th 2014 or lied on November 14th 8 2014 or -- in fact what Mr Bridges agreed to in the plea 9 agreement is that he misled agents on those dates and what he 10 misled them about was his role 11 he didn't confess Your Honor 12 responsibility that he misled the agents who were interviewing 13 him because he did not confess to the theft but today we're 14 hearing he lied 15 government agreed to is that he misled 16 did -- he did not confess at that time although he did confess 17 the very first day he appeared in this court 18 So he never says he lied but So he has accepted Whereas what he agreed to and what the And our position is he Your Honor there is little doubt that sentencing is the 19 most difficult part of your job if I can say that 20 think it must be 21 that either the law is there or not or a verdict -- if there's 22 a bench trial -- the facts and the law come together 23 I just Because it's not like ruling on a motion But here -- Your Honor has done this many times -- has to 24 look And I know you do because Your Honor has indicated 25 you've looked at everything And I know you listened to our Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 48 1 witnesses and you're not just going to sentence on the crime 2 but also bear in mind the actor and his past accomplishments 3 his future his future potential his efforts to rehabilitate 4 along with many other factors 5 And if Your Honor were just going to sentence him on the 6 crime we wouldn't need a hearing we could just ask the 7 government what he should get and be done with it 8 how we do it 9 That's not So I appreciate the fact that Your Honor has a very 10 difficult job and will consider all the relevant factors And 11 that's why I do bring up these points Your Honor 12 don't want to leave here knowing that I could have said 13 something -- even if it's not relevant necessarily to 14 Your Honor's analysis -- we don't want the Court to be misled 15 And with respect to the charge Your Honor there's Because I 16 little that I can say that would lessen the seriousness of 17 Mr Bridges's actions And there are no excuses We're not 18 making excuses Mr Bridges has not made excuses And from 19 the first day he appeared in the courthouse he spoke with the 20 prosecutors 21 Mr Bridges knows he acted foolishly That's an 22 understatement But -- he knows that he acted foolishly when 23 he stole the bitcoins 24 actions affected the integrity of the judicial system his 25 actions violated the trust that his government placed in him But he's not a fool He knows his Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 49 1 and he has acknowledged all of that 2 Your Honor 3 He's acknowledged a lot And when Mr Bridges was finally charged and he came in 4 he knew like any defendant Your Honor he had three options 5 He could plead guilty he could plead guilty and cooperate or 6 he could force the government to meet its burden 7 In a sophisticated case as Your Honor has indicated 8 this would not have been an easy case to try Frankly the 9 state -- the Northern District of California I don't believe 10 had jurisdiction over money-laundering charges but Mr Bridges 11 waived any issues with respect to venue and agreed to have 12 everything resolved here 13 resources and efforts 14 We don't deny that 15 government having Mr Bridges come in on the very first day and 16 allowing prosecutors busy prosecutors to move on to other 17 cases 18 That saved the government tremendous Obviously it helped Mr Bridges too But there was a benefit there to the So Mr Bridges knew he had three choices He didn't 19 waste any time making that decision 20 waiting for this day to come and the day came 21 right away he was going to plead guilty and cooperate 22 He'd spent two years And he knew And he did try to cooperate Your Honor not so much for 23 the purpose of the 5K Usually a 5K as Your Honor well knows 24 is when you can give the government somebody else 25 Mr Bridges knew he couldn't give the government somebody else And Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 50 1 But still the government indicated even knowing that he was 2 a lone actor would assist the government because then they 3 knew they could stop looking that he wasn't in cahoots with 4 somebody else 5 done in Utah in January of 2013 and so he gave -- Mr Bridges 6 gave the government -- 7 And he came in and he acknowledged what he had THE COURT Let me just ask you I want to make sure I 8 understand this 9 you contending he provided some sort of additional assistance 10 11 Beyond finally fessing up what did he -- are to the government MR LEVIN Well what the government told him before he 12 even proffered -- and what I've tried to indicate -- is that he 13 did this by himself 14 working with other people to launder the funds The government didn't know if he had been 15 THE COURT I see 16 MR LEVIN And there was value -- the prosecutors even 17 said there was value in knowing that he acted alone 18 that's -- that's the point Your Honor 19 THE COURT All right 20 MR LEVIN Okay So I understand So I understand Your Honor's point -- 21 well when he finally fessed up -- Your Honor my position is 22 having done this on both sides as a federal prosecutor and 23 defense attorney this wasn't finally fessing up this was 24 coming in earlier the very first day he's charged 25 Now usually people don't come in and confess during the Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 51 1 investigation it's after they're charged 2 charged he immediately made the decision to plead guilty and 3 try to cooperate 4 And once he was So now unfortunately on March 30th the day Mr Bridges 5 appeared and he spoke to law enforcement he misled them 6 he's acknowledged that in the plea agreement 7 hide -- I won't say her name but there's a reference to EP 8 And he tried to hide EP's activities as a Secret Service 9 employee He tried to She wasn't permitted to allow Mr Bridges access to 10 FinCEN 11 and he's acknowledged that in the plea agreement 12 And She did and unfortunately he did try to protect her Still he did eventually do everything that one would 13 hope he would do after March 30th 14 he pled guilty he waived venue he returned all the money he 15 could 16 He signed a plea agreement And I don't think that can be overstated He didn't -- he didn't use the money to travel to fund 17 extravagant parties to eat particularly well to eat well at 18 all 19 doesn't -- he didn't use this money and enjoy it 20 stressed for two years after he stole it 21 the account 22 can't win for losing as they say 23 the argument is he was trying to make it look legitimate -- or 24 he doesn't pay taxes and he's trying to cover his trail 25 Your Honor can see that he's skin and bones He paid taxes But he did pay taxes He He was It was sitting in And for that Mr Bridges he Either he pays taxes -- and And for that there is something Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 52 1 2 to be said for that Your Honor So all of the money that was available has been returned 3 I believe I mean I base that on helping facilitate that 4 process with the Asset Forfeiture Section of the Northern 5 District of California 6 the marketplace 7 the original $850 000 8 worth noting -- I know Your Honor's well aware of this -- that 9 Mr Bridges stole $350 000 worth of bitcoins Some money was simply lost because of As a result of capital losses there's not And this point perhaps it's -- it's 10 market that went up 11 guideline range two levels lower 12 months 13 Because of the And but for that we'd be looking at a I think it's 46 to 57 And so when fashioning a fair sentence -- and I'll try 14 not to repeat this later -- we just ask that Your Honor 15 consider the fact that the guidelines are what they are because 16 of something that was completely out of the control of 17 Mr Bridges 18 If they had risen -- if the bitcoins had risen to a value 19 of ten million dollars I'd be making the same argument 20 they had decreased to a minimal value I think the government 21 would be making an argument that we should be looking at 22 something higher because that's the value of the bitcoins when 23 he took them 24 25 Your Honor I don't know that this needs further addressing but the government does make the -- think the Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net If 53 1 suggestion that Mr Bridges was hoping to wipe his computer by 2 placing it where he placed it I think that's being covered by 3 Ms Golden 4 he's now in the position that everything he does is looked at 5 with suspicion 6 himself and he will continue to have to deal with that the rest 7 of his life 8 this cloud of suspicion over him 9 sometimes sure that's why we consider people's criminal But that's really Mr Bridges's own fault that And that's something Mr Bridges has put upon Every time he does something there's going to be Rightly or not I mean 10 history when they apply for a job is that is this person going 11 to be honest 12 with us 13 Can we trust this person when he comes to work Just during the pendency of this case Your Honor every 14 time Mr Bridges does something it's questioned it's not 15 believed by the government even when we have documentation to 16 demonstrate otherwise 17 a crime -- Mr Bridges was the victim of a crime in Maryland -- 18 he reported it right away to Baltimore city 19 report he contacted the credit card companies to find out if 20 there was any use of the credit cards he asked for a credit 21 report 22 he was asked to come into the federal courthouse for a hearing 23 or even knew that this was an issue 24 25 For instance with respect to reporting He filed a police This was all within a matter of days two weeks before And I say this now -- and I realize that this is really going to go to the issue of self-surrender -- but everything he Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 54 1 does now falls under this cloud of suspicion even though he 2 was a victim of a crime 3 And it's not even clear what the government's theory was 4 And the magistrate judge frankly recognized that it wasn't 5 clear what the government's theory was 6 theft for what purpose 7 replacement ID that would allow him to do what 8 9 He was reporting a So that he could try to get a None of it really made sense if Your Honor looked at it with -- and the judges that heard that couldn't quite 10 understand -- in my opinion they couldn't quite understand 11 what the theory was 12 himself in this position 13 But that's on Mr Bridges for putting Another example Your Honor would be the fact that two 14 days after the last transfer of money was made from Mt Gox to 15 Fidelity Mr Bridges served -- was the affiant on the seizure 16 warrant 17 other 18 place it was automatic 19 seizure warrant that Mr Bridges was notified -- and the 20 government knows this 21 warrant Mr Bridges was notified he'd be the affiant 22 no choice in the matter 23 The two -- the two events had nothing to do with each The fact that there was a transfer was already in THE COURT And it was only days before the Only a few days before the seizure He had He was told he would do it It's rather coincidental I mean seriously 24 It's -- within a very short period of time he knows he's going 25 to be an affiant on the seizure warrant and the funds he knows Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 55 1 that he claims are in there he gets out before that 2 I mean it's pretty -- 3 MR LEVIN He doesn't get them out -- I understand 4 Your Honor but he doesn't get them out 5 under this cloud of suspicion 6 THE COURT That's part of being It's automatic Once the -- Well he's putting it all in motion I mean 7 he -- are you saying he has no idea this can happen to his 8 funds 9 I understand your point 10 11 Granted he doesn't have to trigger the actual event But he's also not clueless that it's going to happen MR LEVIN He knows that in January of 2013 when he set 12 up the account at Mt Gox that Mt Gox allowed him to place a 13 ceiling on the funds so that because Mr Bridges used his own 14 identification Mt Gox set in place that every time the 15 bitcoins reached a value of a hundred thousand dollars 16 automatically they would be transferred to Fidelity 17 So he was involved he was passively involved because he 18 didn't know when it would reach a hundred thousand dollars 19 And each time it did it was transferred to Fidelity 20 coincidence that the same month the last transfer is made he's 21 an affiant 22 appointed to be the affiant only days before the actual seizure 23 warrant was served 24 to affect the investigation 25 account But he didn't decide to be the affiant It is a He was And by being the affiant he did nothing He didn't try to hide his Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 56 1 So again these do look suspicious but the two events 2 are not related to one another But again because of what he 3 did in stealing the bitcoins he's forever going to be looked 4 at with this suspicious glance 5 In the same vein Your Honor it's my understanding 6 based on the discovery that it was Mr Bridges who helped turn 7 in Carl Force 8 is correct from the review of the discovery -- I think that was 9 in the complaint -- if that's correct then Mr Bridges really By turning in Carl Force -- if my understanding 10 caused his own -- his own downfall 11 Force was being investigated ultimately Shaun Bridges was 12 investigated 13 Because once Mr Carl So I harken back to what Mr Bridges's wife said that 14 even after his misconduct he tried to work hard and tried to 15 work with some ethics Your Honor 16 still -- Mr Bridges is the one who reported Carl Force to his 17 supervisors at the Department of Justice 18 led I believe in part to Mr Bridges being uncovered as 19 having taken the bitcoins And in fact he was And that ultimately 20 In their sentencing memo the government suggests that 21 Mr Bridges's misconduct went on for months if not years 22 Your Honor that's -- that's an exaggeration 23 occurred in January 2013 24 a period of two months thereafter 25 That's not -- and again we're not standing here Your Honor His misconduct The transfer of monies occurred for That's a couple of months Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 57 1 saying Oh it's okay because it only occurred for two 2 months 3 and I know that you gave the Court -- the prosecutors some 4 pushback this morning on an overstatement of perhaps there are 5 cases outside this jurisdiction that failed because of 6 Mr Bridges's actions 7 not solely because of Mr Bridges's conduct 8 9 I simply don't want the Court to read something -- But Your Honor pushed back and perhaps So it doesn't -- it certainly doesn't make Mr Bridges's conduct right but it is more of a one-off in the continuing 10 course of misconduct for years that Your Honor saw in the 11 Carl Force case 12 To be sure none of this lessens the seriousness of 13 Mr Bridges's actions 14 acted impulsively in January 2013 and at least since April of 15 2015 he's done everything he could do to make amends 16 But I hope it suggests that Mr Bridges And that leads us to looking at Mr Bridges the person 17 and not Mr Bridges the criminal 18 defined for his actions in January 2013 as a criminal there's 19 an entire life before that night that is worthy of 20 consideration 21 Although he will be forever I know Your Honor's read the sentencing memo and will 22 consider Mr Bridges's contributions both before and after his 23 extraordinary lapse in judgment 24 than what has bought him into this courtroom and the 25 collateral consequences his actions are for him not so But he is a great deal more Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 58 1 collateral 2 reputation been a national disgrace 3 continued national disgrace after today's hearing 4 his freedom 5 his conditions will be much harsher than those of the average 6 prisoner 7 He's lost his profession his livelihood his There will be a He'll lose And while he's serving his term of imprisonment I think Your Honor is well aware of that because of his 8 status of a former law enforcement officer 9 represented a number of law enforcement officers who have been 10 sent to Bureau of Prisons and their conditions of confinement 11 are much worse 12 hours during the day 13 doesn't make it any easier 14 confinement 15 16 And I've certainly They do stay in solitary confinement for many It's for their own protection It's a harsher period of We ask that Your Honor consider all of that in imposing a just and fair sentence Your Honor Thank you 17 THE COURT 18 Mr Bridges this is your sentencing Thank you 19 to speak directly to me 20 totally your choice 21 say now would be the time to say it You have a right You're not required to do so it's But if there is anything that you wish to 22 MR LEVIN May he have a moment 23 THE COURT Yes 24 MR LEVIN Your Honor there are a few things 25 But it Mr Bridges would like me to share with the Court and then I Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 59 1 think he does also wish to speak if that's permissible 2 THE COURT All right 3 MR LEVIN This is not a sentencing hearing for 4 Mrs Bridges as Your Honor already indicated 5 through the consequences the collateral consequences to 6 Mr Bridges in addition to those -- 7 But when I went Incidentally Your Honor by losing his job Mr Bridges 8 had no health care He had been in a relationship with 9 Ms Esposito and they decided in large part -- not only 10 because they were in love -- but they decided to get married so 11 that Mr Bridges could get health care coverage 12 has medical issues which we can talk about after sentencing 13 in terms of issue of self-surrender 14 In fact he But that's why they got married and that's why I felt 15 like it was important to point out that Mrs Esposito did speak 16 with the prosecutor and it was only upon the advice of counsel 17 when prosecutors indicate they did not believe her and wanted 18 her to appear in front of the grand jury that Ms Esposito 19 invoked her marital privilege 20 What Mr Bridges would like me to point out Your Honor 21 is that at the time Ms Esposito was going through Maryland 22 State Trooper Academy training to be a Maryland State Trooper 23 When Ms Esposito returned to Maryland after having flown out 24 to San Francisco she was informed by her supervisors at the 25 academy that they had learned she had invoked her marital Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 60 1 2 privilege and they terminated her Ms Esposito has an employment lawyer and she is trying 3 to get her job back 4 collateral consequences are the fact that somehow word got out 5 from San Francisco to the Maryland State Troopers that 6 Ms Esposito had invoked her marital privilege 7 8 9 But the point is that among the other Your Honor at this point I do believe Mr Bridges would like to be heard THE COURT Thank you Very well 10 Mr Bridges 11 THE DEFENDANT Do pardon me Your Honor because 12 obviously I did not prepare a statement as I was not planning 13 on speaking today 14 But I did want to share a few things I obviously have lost a lot I had a very illustrious 15 career graduated top of my class from the state police top of 16 my class from the Secret Service 17 the governor is willing to write a letter on their behalf 18 Not too many people can say So I'm very proud at least of my past before this this 19 moment that I'm here before you today for 20 I've accepted responsibility 21 don't diminish any fact of that 22 likely period of incarceration 23 And I don't deny that and I I expect you to give me a My wife lost her employment I owe all this money I've lost a lot I gave up an illustrious 24 career Though I never spent a penny of 25 it I have to pay back money to the Department of Justice that Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 61 1 I paid for taxes to the state of Maryland 2 different departments 3 I've even taken 4 There's two So I owe more money technically than I just want to at least address for your own 5 clarification just a few issues that the government brought 6 up 7 This entire investigation began when I was notified about 8 criminal activity of Carl Force 9 exchange contacted me personally notified me about 10 11 An international coin Carl Force's criminal activity Within two hours of being notified I had elevated it 12 through the chain of command and reported it and instructed 13 this foreign institution to file what's referred to as a 14 Suspicious Activity Report on Carl Force 15 this entire investigation 16 That is what began Within the coming days Ms Haun called me at my personal 17 residence to discuss the report that was filed on Carl Force 18 And that is what ended up leading to my own downfall 19 such I had lived with this burden for two years 20 never spend any of it 21 it would ultimately lead to me 22 worked with him they're obviously going to look at me 23 accept that 24 25 Knowing I could I knew when I turned in Carl Force that I mean the person turning him But I I don't diminish one bit of it here I just want to also address the Mt Gox issue since you just brought that up with them The government knows this Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 62 1 I've turned over an email to them I was assigned that seizure 2 within a week of doing that seizure 3 approximately a hundred million dollars a month 4 business didn't cease operation after that seizure And Mt Gox did Their 5 And the only reason I say that is again not in any form 6 to diminish my actions but the allegation that it was somehow 7 timed the money could be have been withdrawn after the 8 seizure 9 10 11 12 I mean it didn't affect their operation They moved a hundred million dollars a month and we seized two million But I wanted to be clear that I accept full responsibility 13 I think the people that flew all the way here from 14 Baltimore to speak on my behalf Ms Golden and my wife who 15 is -- she's lost everything 16 enforcement and now she's lost it all 17 18 She went to college to be in law Again I didn't have anything prepared but I at least wanted to apologize to everybody 19 Thank you 20 THE COURT 21 Mr Levin anything further 22 MR LEVIN Nothing further Your Honor 23 THE COURT All right 24 MR LEVIN Should we have a seat or -- 25 THE COURT Yes you may Thank you Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 63 1 Anything further 2 MS HAUN Your Honor very quickly just for the record 3 Because we are creating a record Mr Evans and I we can 4 respond to a number of things 5 short on time We won't I know we're running 6 Just three brief things 7 One the understanding Mr Levin had about the 8 investigation into Carl Force started coming from Mr Bridges 9 That's not correct I'm not going to get into in open court 10 how our investigation began but it was not -- it was but for 11 Mr Bridges not because of Mr Bridges 12 The second thing we just wanted to clarify about 13 Mr Levin commented about putting into context and he read a 14 text message 15 messages 16 forth- -- That's one of dozens and dozens of text And I want the Court to know that we've been fully 17 THE COURT 18 MS HAUN This is a point about Mr Green Yes And we've been fully forthcoming with 19 the Court and you heard from Mr Green himself there were a 20 number of other text messages that Russ Ulbricht sent with his 21 employees of the Silk Road -- and not just Force -- after the 22 message that you heard from today 23 So we do believe that one of the primary reasons -- and 24 we continue to believe one of the primary reasons that there 25 was a hit put out for Mr Green was because of Mr Bridges's Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 64 1 2 conduct And finally Your Honor we heard from Mr Levin that 3 Mr Bridges tried to cooperate with the government he came 4 fully clean he told us everything 5 Your Honor there were about six federal agents and three 6 federal prosecutors and he tried to tell us that actually he 7 didn't steal Mr Green's money or that 21 000 bitcoins he only 8 stole part of it 9 stole the first couple of transactions but he actually said -- He actually -- I won't tell you who he said 10 and he might even continue today to sit here and tell you -- 11 that he didn't make the first two transfers out of Mr Green's 12 account and that someone else did those 13 individual for those 14 And he blamed another So for him to say that he cooperated with the government 15 in this proffer session Your Honor the government feels quite 16 differently about whether or not he was forthcoming and we 17 certainly don't think he cooperated in the investigation 18 And we just wanted to make those points for the record 19 And I think that's -- that covered it 20 MR EVANS 21 Just the fact that it was not a cooperation agreement Your Honor it was a straight-up employment 22 THE COURT I understand Very well 23 Applying the factors that are set forth under 18 USC 24 3553 a this is the point where the statute directs me to 25 determine a sentence which is sufficient but not greater than Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 65 1 necessary 2 consisting of the betrayal of public trust by a federal law 3 enforcement agent 4 entirely by greed 5 This to me is an extremely serious crime And from everything I see it was motivated Mr Bridges engaged in what I think is a sophisticated 6 thought-out scheme in which he stole substantial sums of money 7 And he attempted to cover his tracks which in one of the most 8 significant factors to me -- and I appreciate Mr Green having 9 come forward -- as I said before it is inexcusable for a 10 federal agent to put a cooperating witness at risk in the 11 fashion that was done here 12 threats that emanated from it to me that's not the central 13 point 14 of public trust that could -- could very possibly have gotten a 15 person killed 16 Whether or not there was actual The central point again is the extraordinary betrayal I think in the interest of deterrence both general 17 deterrence and as to Mr Bridges as an individual and to 18 promote respect for law no departure or variance is warranted 19 in this case 20 Now I acknowledge Mr Bridges's earlier years of service 21 with law enforcement but nothing in that background I think 22 excuses or mitigates what is to me a shocking and reprehensible 23 abandonment of his public duty 24 references in Dr Bloomberg's report to alcohol issues and 25 depression issues simply unconvincing in this context as a And I similarly find the Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 66 1 mitigating factor 2 imposing a high-end guideline sentence but I think it is 3 required in this case 4 5 I seldom find myself in the position of Any legal reason why sentence may not be imposed at this time 6 MR EVANS No Your Honor 7 MR LEVIN No Your Honor 8 THE COURT Pursuant to the Sentencing Reform Act of 9 1984 it is the judgment of the Court that Shaun Bridges is 10 hereby committed to the custody of the Bureau of Prisons to be 11 imprisoned for a term of 71 months 12 13 14 This term consists of terms of 71 months on Counts 1 and 2 all counts to be served concurrently The Court recommends that the defendant participate in 15 the Bureau of Prisons' Residential Drug Abuse Treatment 16 Program 17 Upon release from imprisonment the defendant shall be 18 placed on supervised release for a term of three years 19 term consists of terms of three years on each of Counts 1 and 20 2 all such terms to run concurrently 21 This Within 72 hours of release from the custody of the Bureau 22 of Prisons the defendant shall report in person to the 23 probation office in the district to which the defendant is 24 released 25 While on supervised release the defendant shall not Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 67 1 commit another federal state or local crime shall comply 2 with the standard conditions that have been adopted by this 3 Court shall refrain from any unlawful use of a controlled 4 substance and submit to a drug test within 15 days of release 5 on supervised release and two periodic drug tests thereafter 6 and shall comply with the following conditions 7 defendant shall participate in a program of testing and 8 treatment for alcohol abuse as directed by a probation officer 9 until such time as the defendant is released from treatment by 10 11 One the the probation officer The defendant is to pay part or all of the cost of this 12 treatment in an amount not to exceed the cost of treatment as 13 deemed appropriate by the probation officer 14 Payment shall never exceed the total cost of urinalysis 15 and counseling 16 determined by the probation officer 17 18 The actual copayment schedule shall be Two the defendant shall abstain from the use of all alcoholic beverages 19 Three the defendant shall pay any special assessment 20 that is imposed by this judgment and that remains unpaid at the 21 commencement of the term of supervised release 22 Four the defendant shall provide the probation officer 23 with access to any financial information including tax 24 returns and shall authorize the probation officer to conduct 25 credit checks and obtain copies of income tax returns Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 68 1 Five the defendant shall submit his person residence 2 office vehicle or any property under his control to a search 3 Such a search shall be conducted by a United States Probation 4 Officer at a reasonable time and in any reasonable matter based 5 upon reasonable suspicion of contraband or evidence of a 6 violation of a condition of release 7 a search may be grounds for revocation 8 9 10 11 12 13 14 Failure to submit to such The defendant shall warn any residents the premises shall be subject to searches Six the defendant shall not have any contact with any co-defendant in this case namely Carl Mark Force IV Seven the defendant shall cooperate in the collection of DNA as directed by the probation officer Eight the defendant shall not own or possess any 15 firearms ammunition destructive devices or other dangerous 16 weapons 17 It is further ordered the defendant shall pay to the 18 United States a special assessment of $200 which shall be due 19 immediately 20 When incarcerated payment of criminal monetary penalties 21 are due during imprisonment at the rate of not less than $25 22 per quarter and payments shall be through the Bureau of 23 Prisons' Inmate Financial Responsibility Program 24 25 Criminal monetary payment shall be mailed to the clerk of the US District Court 450 Golden Gate Avenue Box 36060 Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 69 1 2 3 4 San Francisco California 94102 The defendant's interest in the following property shall be forfeited to the United States The defendant's interest in the property to be forfeited 5 is $165 529 88 from Fidelity brokerage account held in the name 6 of Quantum Investments 306 000 held in trust in the attorney 7 of record's name $4 745 92 from PNC bank account jointly-held 8 in the name of Shaun Bridges and a person known to the parties 9 and 651 000 monetary judgment 10 I do find that the defendant does not have the financial 11 resources to pay a fine and order that the fine be waived 12 The next question that we need to address is the 13 14 surrender question MR EVANS What's the government's position Your Honor given the length of the custodial 15 sentence that the defendant has just been sentenced to the 16 government moves to have the defendant remanded into custody at 17 this time 18 this point in time is suffering from depression as his 19 physician has indicated he's also indicated there's issues 20 with alcohol and so forth and those are factors to be 21 considered in terms of public safety and safety of the 22 defendant himself 23 The government does not doubt that Mr Bridges at We think that those issues are taken away taken off the 24 table if the defendant is remanded into custody at this point 25 in time Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 70 1 Just in terms of -- the Court made reference earlier -- 2 and I think it was discussed earlier about you know the fact 3 that he Mr Bridges -- when he went in to make a police 4 report he didn't in fact file a police report 5 at that point in time that he just wanted a case number and 6 didn't in fact want to file a police report 7 He indicated So there are certain issues that go with -- whether it's 8 changing the Social Security number on the name all these 9 things the Court has heard before which give the government 10 continued concern about his possible intention to flee and 11 possible safety risk to himself and the community 12 13 14 We think all those things mitigate toward remanding the defendant into custody at this point in time THE COURT The second issue that arose in the pretrial 15 release context involved trying to get some Maryland State 16 Police records 17 were proceedings in front of the magistrate judge I believe 18 in -- initially in Baltimore and then video conference with 19 Judge -- I guess it was James here 20 MR EVANS Whatever happened with that I know there There was an audio conference or a hearing 21 held by the magistrate judge out here in San Francisco 22 Your Honor in which the judge increased the defendant's 23 presentencing confinement or presentencing release conditions 24 in which he additionally instructed or placed him on home 25 confinement and restricted him to any access to computers and Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 71 1 prevented him from actually leaving his home other than to meet 2 with his attorney 3 THE COURT In terms of assessing whether or not 4 Mr Bridges is either a flight risk or a danger to himself 5 not I don't think danger to others is really implicated 6 here 7 should take into account 8 understand your point that he now -- Mr Bridges knows the 9 significant sentence that he does indeed face and that is Why are those incidents indicative of something that I Why do they cause you -- I 10 certainly something to take into account 11 issues that you mentioned before with respect to mental 12 health alcohol issues 13 14 15 And some of the But the pretrial release problems if you will that he had why are those indicative of a greater flight risk MR EVANS Your Honor the point I'm trying to make in 16 that is the fact that the government has sought his detention 17 for some time now since back in I think July 18 THE COURT Well I understand that but what I'm trying 19 to get at is -- I know that was the position you took but is 20 that because you thought these -- this activity was in the 21 process of trying to get identity to leave the country or -- 22 MR EVANS Yes Your Honor We thought that those 23 things could be connected with possible intentions to flee the 24 jurisdiction 25 new name trying to have those shielded from law enforcement Trying to obtain a new Social Security number a Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 72 1 2 and the courts We thought those were indications of possible attempts to 3 obtain additional or alternate identities or identifications 4 where he could then flee the jurisdiction 5 again this is one of those cases where defendant has complied 6 with the restrictions placed on him by the Court however the 7 sentence has now been handed down it is a lengthy prison 8 sentence that defendant is looking at at this point in time 9 And because of those concerns ongoing concerns that the We think that 10 government has had since this summer about possible attempts to 11 flee -- as well as the latest revelations about his mental 12 state and his abuse of alcohol -- we think that all of those 13 issues point toward remanding the defendant into custody at 14 this point in time and the onus is on Defendant at this point 15 in time to show why -- 16 THE COURT Mr Bridges has known -- by virtue of his own 17 counsel's sentencing brief he's known he's going to face a 18 substantial sentence 19 not less than 36 months 20 And so the -- the defense position was So he's had it in mind that that's out there that that 21 was -- I think -- I suspect he walked in today with the 22 understanding that a custodial sentence was going to be imposed 23 and yet he's made his court appearances he's shown up 24 25 So the fact that perhaps it is a longer sentence than he has hoped to receive -Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 73 1 MR EVANS I think it's significantly longer 2 Your Honor 3 and it's almost double that 4 period of time 5 I think the defendant was asking for 36 months So we're looking at a significant Almost six years And for that reason Your Honor I think maybe the 6 calculus changes in defendant's mind 7 position has consistently been that release is not appropriate 8 in this case 9 But the government's And now that he's been sentenced to 71 months 10 incarceration the government feels more strongly than ever 11 that defendant should be remanded into custody at this point in 12 time as opposed to allowed to self-surrender 13 THE COURT Mr Levin 14 MR LEVIN Thank you Your Honor Mr Bridges has 15 complied with all the terms and conditions of his pretrial 16 release 17 appear for 18 frankly I think Mr Bridges expected a guideline sentence 19 think to some degree there's a relief now that it's behind him 20 and he can move forward by serving his sentence 21 He's been at every court appearance he's been told to The fact that he received a guideline sentence I The fact that there was a -- that he has suffered from an 22 alcohol abuse problem he sought counseling for that and has 23 been alcohol-free for -- I think 40 weeks if I'm not 24 mistaken -- because he sought treatment for his alcohol 25 problem And now he has been locked down in his home and Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 74 1 there's no indication that his alcohol abuse has created an 2 issue while on pretrial release Your Honor 3 A couple of other points if I may We're going to be 4 asking that Mr Bridges be designated to a Bureau of Prisons 5 facility in Maryland 6 transfer from California to Maryland when that occurs while 7 we're waiting for that to occur Mr Bridges will no doubt be 8 in solitary confinement 9 ordeal as I'm sure Your Honor is aware FCI in Cumberland specifically The The transfer itself is a horrendous There's cost also 10 involved 11 government cost it's still a cost that the government wouldn't 12 otherwise have to have borne and -- or bear out 13 And while it may be minimum in the grand scheme of So there's every reason to believe -- and Mr Bridges has 14 strong support from his wife 15 His former supervisor is here 16 Mr Bridges knows he can rely on when he eventually gets out of 17 confinement 18 19 20 His mother-in-law is also here These are all people But the fact is that he has complied with his conditions and -THE COURT Well I suppose my bigger concern right now 21 is just you have -- doing your job have presented to me some 22 issues of concern about his mental health and also I now 23 appreciate your comments about the alcohol issue 24 25 But that's -- it's -- I will be the first to acknowledge a big sword hanging over him at the moment that he is going to Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 75 1 have to report to prison 2 that -- you know that that's perhaps going to be too much 3 to -- for him to deal with 4 And I have some genuine concern And so that's where my question is coming from If 5 you -- you've probably already addressed it to the extent you 6 can 7 allowed to self-surrender to have a confidence level that at 8 the very least there's not going to be any attempt to leave 9 the jurisdiction but just is he in a mental position to be 10 11 But the issue of in the interim time period should he be able to tolerate this MR LEVIN It's a fair question Your Honor Two 12 responses First I believe the statute says to consider 13 whether or not Mr Bridges is a flight risk or a danger to the 14 community 15 THE COURT True 16 MR LEVIN Not a danger to himself 17 THE COURT Well I guess the statute may not say that 18 but I am concerned if people are a danger to themselves 19 don't know if the statute specifically lets me take that into 20 account but I've got to tell you I do take that into account 21 MR LEVIN And I And that's why there's a second point 22 Your Honor Dr Bloomberg stated that he believed 23 Mr Bridges's prognosis is excellent and he indicated that 24 Mr Bridges has indicated no suicidal ideations 25 for the two years between the theft and the charging this As I said Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 76 1 case -- the potential for a case like this hung over him -- I 2 believe I wrote -- like a sword of Damocles 3 I think that is a bigger sword than the sword now facing 4 him in terms of reporting to prison 5 what he's going to get 6 RDAP which will help him 7 earn good-time credit 8 anticipates and wants to take advantage of certain programs 9 He knows for certainty He knows that he might be eligible for He has every reason to behave and These are all things that Mr Bridges As I said I think Mr Bridges in some respect is 10 relieved to finally have this day over with and he can then 11 prepare for serving his sentence Your Honor 12 MR EVANS Your Honor if I can just respond and remind 13 the Court that the statute uses the language shall in terms 14 of remand absent extraordinary circumstances 15 diagnosis of Dr Bloomberg of a specified personality disorder 16 insecure schizoid impulse features and so forth we're 17 concerned that that diagnosis is out there And given the 18 And again because of the statute using the language 19 shall except in extraordinary circumstances we don't believe 20 this is one of those cases that it falls into that category and 21 we think that it's best for the defendant and for general 22 public that he be remanded in custody 23 And I will point out that the government's paying for his 24 transportation and stay out here regardless as the Court has 25 granted motions for him to do that So whether he's Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 77 1 transported back by the marshal's service or he flies back the 2 government is bearing the cost Your Honor 3 MR LEVIN The government does not pay for Mr Bridges's 4 return to Maryland Your Honor 5 order That was clear in Your Honor's 6 THE COURT I authorized his one-way travel here 7 MR EVANS I apologize Your Honor 8 THE COURT Okay 9 Is the matter submitted All right 10 MR EVANS Yes Your Honor 11 MR LEVIN Yes Your Honor 12 THE COURT I will allow Mr Bridges to self-surrender Thank you 13 Self-surrender also carries some significance in terms of as I 14 understand it Bureau of Prisons 15 because I am -- I am troubled I am concerned by the pretrial 16 conduct which struck me as -- if not indicative of flight just 17 quite odd and caused me concern 18 So as I say it's a close call 19 allow him to do that 20 facility in Maryland 21 But it's a very close call But I am willing to I will make the recommendation for the But I want a short self-surrender date So I know they 22 may not have designated at the time that he surrenders but he 23 nonetheless has to surrender 24 January 25 So I'm looking for something in Do you have a suggestion for me MR LEVIN I have to look at what day of the week but I Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 78 1 would ask for January 30th Your Honor 2 THE COURT Well -- 3 THE CLERK That's a Saturday 4 MR LEVIN January 29th Your Honor 5 THE COURT All right And he would then surrender -- if 6 there's no designation at that time he would have to 7 surrender I believe to the marshals in Baltimore 8 where he would go 9 10 MR LEVIN That's correct Your Honor Is that Based on my experience that's correct 11 THE COURT I think you're right 12 MR LEVIN Thank you Your Honor All right We would ask for -- 13 Mr Bridges did serve -- between the time he was detained until 14 he was released after the hearing back in Baltimore he 15 served I believe five days 16 THE COURT We'd ask for five days' credit I think that is a function of -- I don't 17 usually order that It's whatever the Bureau of Prisons 18 applies or doesn't And then if there's an issue I suppose 19 you can bring it up 20 time is credited or not 21 Prisons to calculate 22 MR LEVIN 23 But I don't generally order that certain I leave that for the Bureau of I just wanted to have it on the record that it was five days if anyone looks at it 24 THE COURT All right 25 MR LEVIN Thank you Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net 79 1 THE COURT Mr Bridges under paragraphs 4 and 5 of your 2 plea agreement it indicates that you have given up the bulk of 3 your appellate rights with some of the limited exception 4 pertaining to the entry of the plea and ineffective assistance 5 Not suggesting one way or the other if you have any 6 appellate rights remaining if you do wish to file a notice of 7 appeal you need to do that 14 days from the entry of judgment 8 You understand that 9 THE DEFENDANT Yes sir 10 THE COURT All right Very well 11 MR LEVIN Thank you Your Honor 12 MS HAUN 13 Proceedings adjourned at 1 02 P M Thank you Your Honor 14 15 16 17 18 19 20 21 22 23 24 25 Kelly Polvi CSR RMR FCRR - 503 779 7406 kpolvi@comcast net CERTIFICATE OF CONTRACT REPORTER I Kelly Lee Polvi certify that pursuant to Section 753 Title 28 United States Code that the foregoing is a true and correct transcript of the stenographically-reported proceedings held in the above-entitled matter and that the transcript format is in conformance with the regulations of the Judicial Conference of the United States Dated this 14th day of January 2016 _______________________________ Kelly Lee Polvi CA CSR No 6389 Registered Merit Reporter Federal Certified Realtime Reporter Kelly Polvi CSR RMR FCRR P O Box 1427 Alameda CA 94501 503 779 7406 kpolvi@comcast net This document is from the holdings of The National Security Archive Suite 701 Gelman Library The George Washington University 2130 H Street NW Washington D C 20037 Phone 202 994-7000 Fax 202 994-7005 nsarchiv@gwu edu