Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 1 of 40 Pages 1 - 39 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA BEFORE THE HONORABLE RICHARD SEEBORG JUDGE UNITED STATES OF AMERICA Plaintiff vs SHAUN W BRIDGES Defendant ___________________________________ NO CR 15-319 RS San Francisco California Wednesday August 31 2015 3 31 p m TRANSCRIPT OF PROCEEDINGS APPEARANCES For Plaintiff BY BY Reported by MELINDA HAAG United States Attorney 450 Golden Gate Avenue San Francisco California 94102 KATHRYN R HAUN WILLIAM FRENTZEN Assistant United States Attorneys and UNITED STATES DEPARTMENT OF JUSTICE Criminal Division Public Integrity Section 1400 New York Avenue N W 12th Floor Washington D C 20005 RICHARD B EVANS ESQ BELLE BALL CSR #8785 CRR RDR Official Reporter U S District Court Appearances continued next page Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 2 of 40 APPEARANCES CONTINUED For Defendant BY BY Also Present LEVIN AND CURLETT LLC 201 North Charles Street Suite 2000 Baltimore Maryland 21201 STEVEN H LEVIN ESQ and SNELL AND WILMER 50 West Liberty Street Suite 510 Reno Nevada 89501 CRAIG DENNEY ESQ BRAD T WILSON U S Pretrial Services Officer Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 3 of 40 1 MONDAY AUGUST 31 2015 3 03 P M P R O C E E D I N G S 2 3 THE CLERK Calling Criminal Case No 15-319 United 4 States versus Shaun Bridges 5 your appearances 6 3 MS HAUN Please step forward and state Good afternoon Your Honor Kathryn Haun 7 for the United States 8 Frentzen from my office and also Richard Evans from the Public 9 Integrity Section of the Department I'm joined by my colleagues Mr William 10 THE COURT 11 MR FRENTZEN 12 MR LEVIN 13 Good afternoon Good afternoon Your Honor Good afternoon Your Honor Steven Levin on behalf of Mr Bridges who is standing to my right 14 THE COURT 15 MR DENNEY 16 THE COURT Good afternoon Craig Denney Your Honor Good afternoon This matter is on my 17 calendar for my understanding is the entry of a plea 18 that correct 19 MS HAUN That's correct Your Honor Is And the 20 parties lodged some time ago the executed plea agreement 21 there have been no changes since we lodged that with the Court 22 THE COURT 23 MS HAUN And Okay very good And if the Court is all right with it 24 today I propose since I represented the government in the 25 Force entry of plea I would like to ask for the Court's Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 4 of 40 4 1 permission today for my colleague Mr Evans from the Public 2 Integrity section if it's all right with the Court for him to 3 handle some of the elements and the factual basis 4 THE COURT Sure 5 MS HAUN Thanks 6 THE COURT That's fine with me Mr Bridges my understanding is that you 7 are prepared to enter a plea this afternoon 8 would like to proceed sir 9 10 11 12 13 THE DEFENDANT THE COURT Is that how you Yes Your Honor All right I'm going to ask my courtroom deputy to put you under oath at this time Defendant placed under oath THE COURT Mr Bridges you are now under oath I'm 14 going to be asking you some questions 15 questions truthfully 16 answer my questions truthfully you could face charges in 17 addition to those that are the subject of our discussion this 18 afternoon You need to answer my In the event that you were to fail to 19 Do you understand that 20 THE DEFENDANT 21 THE COURT 22 THE DEFENDANT 23 THE COURT 24 THE DEFENDANT 25 THE COURT I understand Okay What is your full name sir Shaun Wesley Bridges Okay And how old are you Mr Bridges Thirty-three Okay What was the highest grade level Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 5 of 40 1 5 you reached in school 2 THE DEFENDANT 3 THE COURT Sixteenth Okay You have been represented by 4 counsel in this case 5 record but let me mention their names again And counsel's appearance was on the 6 MR LEVIN Steve Levin Your Honor 7 THE COURT Mr Levin excuse me It's Mr Evans And then 8 apparently other counsel 9 representation that you have received in the case 10 THE DEFENDANT 11 THE COURT Have you been satisfied with the I have Your Honor All right Now in the last 24 hours 12 have you had occasion to take any prescription medication any 13 drugs or alcohol that would affect your ability to understand 14 our discussion here this afternoon 15 THE DEFENDANT 16 THE COURT No sir Now I have been handed a plea 17 agreement -- provided with it actually in advance -- and it 18 has various signatures on it one of which indicates that it's 19 your signature 20 Is that your signature Indicating Mr Bridges 21 THE DEFENDANT 22 THE COURT 23 That is sir All right And did you have an opportunity to review this plea agreement 24 THE DEFENDANT 25 THE COURT I did Did you have an opportunity to discuss it Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 6 of 40 1 6 with your counsel 2 THE DEFENDANT 3 THE COURT Yes sir Now are all of the understandings that 4 you have with the government that are prompting you to proceed 5 by way of a plea this afternoon are they all contained in this 6 written document 7 THE DEFENDANT 8 THE COURT 9 10 Okay oral understandings THE DEFENDANT 12 THE COURT Correct Okay Has anyone threatened or coerced you in any way to enter a guilty plea this afternoon 14 THE DEFENDANT 15 THE COURT 16 In other words what I want to confirm is as far as you know there are no side agreements or 11 13 They are sir No sir This is your voluntary decision to proceed this way 17 THE DEFENDANT 18 THE COURT Yes sir This particular plea agreement is entered 19 into under a rule we refer to as Rule 11 c 1 A and 20 11 c 1 B 21 agreement contains various recommendations to me as to how I 22 should assess and what sentence I should impose Under the provisions of that rule this plea 23 Do you understand that 24 THE DEFENDANT 25 THE COURT Yes sir And do you also understand that these are Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 7 of 40 7 1 simply recommendations and that it will be for me to decide 2 what the appropriate sentence is 3 THE DEFENDANT 4 THE COURT I do sir Okay And that sentence can under the 5 law go up to the statutory maximum of the charges the 6 particular statutes under which you are charged 7 And in this instance you are charged in Counts 1 and 2 of 8 the information that is the subject of our discussion today 9 with money laundering in violation of Title 18 United States 10 Code Section 1957 and with obstruction of justice in violation 11 of Title 18 United States Code Section 1512 c 2 12 On that first count the money-laundering count the 13 maximum prison term you could receive in the event of 14 conviction is 20 years imprisonment a $250 000 fine or twice 15 the gross gain or loss whichever is greater a three-year term 16 of supervised release restitution to be determined a $100 17 mandatory special assessment and forfeiture as appropriate 18 Under Count 2 which is the obstruction-of-justice count 19 again the maximum penalty could you receive in the event of 20 conviction would be 20 years imprisonment $250 000 fine 21 three-year term of supervised release restitution to be 22 determined $100 mandatory special assessment and forfeiture 23 as appropriate 24 25 Do you understand that your sentence under the law that I can impose could be up to that maximum on each of those Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 8 of 40 1 8 counts 2 THE DEFENDANT 3 THE COURT I do sir All right Now in this plea agreement 4 in particular in Paragraphs 4 and 5 it indicates the language 5 of the agreement is that you are giving up various of your -- 6 the bulk of your appellate rights 7 In Paragraph 4 you are giving up what's called your direct 8 rights to appeal 9 giving up your collateral appellate rights sometimes referred 10 to as habeas rights with the exception that you reserve the 11 right to claim ineffective assistance of counsel in connection 12 with negotiating this plea agreement and the entry of your 13 guilty plea And then in Paragraph 5 it indicates you are 14 Do you understand that under the terms of the plea 15 agreement that is what it indicates that you are giving up 16 those appellate rights 17 THE DEFENDANT 18 THE COURT I do sir Now in this case you have a right to 19 maintain a not-guilty plea 20 trial in the case 21 be represented by counsel 22 opportunity to call witnesses to testify in your behalf and 23 cross-examine any witnesses the government calls -- would call 24 to testify against you 25 You have a right to proceed to At that trial you would have the right to Your counsel would have an At that trial you would have a right to testify At the Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 9 of 40 9 1 same time you could elect not to testify 2 that decision the government would be precluded from making 3 any reference to the fact that you had made that decision 4 The case would then be submitted to a jury of 12 And if you made 5 individuals 6 would have to conclude that the government had proven your 7 guilt beyond a reasonable doubt 8 convicted you would have a right to appeal and a right to be 9 represented in that process 10 11 And in order for you to be found guilty all 12 And then if you are If you enter your guilty plea today you will be giving up all those rights Do you understand that 12 THE DEFENDANT 13 THE COURT 14 MR FRENTZEN 15 THE COURT I do sir Very well Again Mister -- Evans Your Honor Mr Evans if you could review for us the 16 elements of the charges that the government would be prepared 17 to prove and also the factual basis that the government would 18 be prepared to present 19 MR EVANS Yes Your Honor Should this -- the 20 elements of the first count Count 1 18 U S C Section 1957 21 money laundering the elements are as follows 22 Defendant knowingly engaged or attempted to engage in a 23 monetary transaction 24 25 Two that he knew the transaction involved criminally-derived property That the Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 10 of 40 10 1 Three that the property had a value greater than $10 000 2 Four the property was in fact derived from wire fraud 3 And five that the transaction occurred within the United 4 5 States Wire fraud being the underlying -- the SUA for this 6 particular money-laundering count 7 fraud are that 8 plan to defraud or to obtain money or property by means of 9 false or fraudulent pretenses representations or promises 10 11 12 13 14 And the elements of wire The Defendant knowingly devised a scheme or Two that the statements made or facts omitted were material And three that he acted with intent to defraud and that is the intent to deceive or cheat And four that he used or caused to be used an interstate 15 wire communication to carry out or attempt to carry out an 16 essential part of that scheme 17 In terms of Count 2 the obstruction count a violation of 18 18 U S C Section 1512 c 2 the elements are that the 19 Defendant obstructed influenced or impeded an official 20 proceeding 21 corruptly 22 And two that he did so -- in doing so he acted And there are in fact two official proceedings of which 23 the factual basis address 24 point 25 And I'll go through those at this Your Honor in terms of the money laundering and the Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 11 of 40 11 1 obstruction the factual basis agreed to by the parties as 2 reflected in the plea agreement indicates that on or about 3 January 25 2013 the Defendant devised a scheme to defraud and 4 obtain money and property through false and fictitious 5 representations in that he used an administrator account on 6 the Silk Road website belonging to another individual and not 7 intended for his personal use to gain access to that site 8 Once he had gained access to that Silk Road website he 9 used the information to change passwords and PINs on various 10 accounts and to move approximately 20 000 Bitcoins from various 11 Silk Road vendor accounts into a wallet which he exercised 12 control 13 approximately $350 000 And the value of those Bitcoin at that time was 14 And that on or about January 26 2013 he moved that 15 Bitcoin into an account at Mt Gox which is a digital currency 16 exchange based in Japan 17 Subsequently on October 27 2013 sic he attempted to 18 lull the manager of the Silk Road website -- that's William 19 Ross -- Ross William Ulbricht also known as Dread Pirate 20 Roberts -- by telling them that the Bitcoin actually had been 21 stolen from him 22 And that that communication the government if this had 23 gone to trial could prove took place when Mr Ulbricht was in 24 the Northern District of California on that date when the 25 Defendant was in Maryland at the time Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 12 of 40 1 12 Now subsequently to that Your Honor the United States 2 would prove and the parties have agreed to in the factual basis 3 that between March and May of 2013 the Defendant converted the 4 Bitcoin into U S currency and caused wire transfers of the 5 money totaling approximately $820 000 at the time from the 6 accounts at Mt Gox into a Quantum International Investments 7 LLC account at Fidelity in the United States 8 And subsequently that on June 2nd 2014 the Defendant 9 transferred funds from that Quantum Fidelity account into an 10 11 account in the joint names of himself and one other individual Your Honor the factual basis lists the specific wires 12 the dates of those wires and the amounts on Page 4 of the plea 13 agreement 14 factual basis part of the plea agreement that the funds in 15 these transactions were proceeds of wire fraud 16 Defendant carried out each of these transactions with the 17 intent to promote an ongoing wire fraud scheme and to conceal 18 and disguise the nature the location the source ownership 19 and origin of these illegal proceeds And the parties have agreed stipulated in the And that the 20 Now during this time Your Honor that the Defendant 21 devised and carried out this fraud money-laundering scheme he 22 was a Special Agent of the United States Secret Service and a 23 member of the Electronic Crimes Task Force of the Baltimore 24 Silk Road Task Force 25 investigating the Silk Road its vendors buyers as well as And was actively engaged in Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 13 of 40 13 1 Dread Pirate Roberts for which there was an ongoing grand jury 2 investigation in the District of Maryland 3 has agreed that the Baltimore Silk Road grand jury 4 investigation was in fact an official proceeding 5 Now the Defendant as a Secret Service Special Agent 6 held a position of trust 7 that position 8 And the Defendant And he abused that trust abused Defendant in the factual basis further agrees that his 9 activities obstructed influenced and impeded the grand jury 10 -- the Baltimore grand jury investigation into the Silk Road 11 as well as resulting in the case of Maryland -- excuse me -- in 12 the District of Maryland against Ulbricht among other things 13 obstructing and impeding the ability of the investigation to 14 fully utilize the corroborators' access to the Silk Road after 15 the Defendant's fraud causing the task force and the grand 16 jury to spend time and effort to investigate the thefts of the 17 Silk Road that he committed creating additional incentive for 18 Mr Ulbricht to attempt to hire someone to kill a cooperator 19 whom Mr Ulbricht suspected of committing the thefts that in 20 fact he had committed 21 influencing and impeding the grand jury's investigation of or 22 into Ulbricht in the District of Maryland And finally obstructing and 23 Your Honor the factual basis also agreed to by the 24 parties indicates that as of May of 2014 there was an active 25 San Francisco-based grand jury investigation into the potential Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 14 of 40 14 1 misconduct of a Drug Enforcement Administration agent DEA 2 agent by the name of Carl Mark Force 3 San Francisco grand jury subsequently began to investigate the 4 Defendant's misconduct And that that 5 On or about May 28 2014 the Defendant was interviewed by 6 Special Agent with the FBI and intentionally misled that agent 7 as part of the San Francisco-based grand jury investigation 8 Additionally on November 13 2014 he was again 9 interviewed by a Special Agent from the Department of Justice 10 Office of Inspector General and he intentionally misled that 11 agent as well 12 And during January and February of 2015 he consulted with 13 another employee of the United States Secret Service both 14 before and after that employee was interviewed by agents for 15 the Department of Homeland Security Office of Inspector General 16 and the FBI 17 witness to tell a false consistent story regarding the searches 18 conducted on a database controlled by the Financial Crimes 19 Enforcement Network or FinCEN 20 And that the Defendant agreed with the other Finally Your Honor on March 30 2015 in the Northern 21 District of California the Defendant also misrepresented 22 certain facts to agents with the FBI and the Internal Revenue 23 Service criminal investigations with respect to the full scope 24 of the FinCEN database searches 25 obstructed the investigation of the San Francisco-based grand And these acts Your Honor Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 15 of 40 1 2 3 15 jury Those are the facts agreed upon by the parties' plea agreement Your Honor 4 THE COURT Mr Bridges I know that was a long 5 recitation of facts I'm going to go over them with you 6 7 But let me begin by just asking you the question You've heard the prosecutor review all those facts correct 8 THE DEFENDANT 9 THE COURT I have sir And do you -- and are they correct 10 THE DEFENDANT 11 THE COURT All right 12 MR LEVIN Your Honor if I may I may have misheard 13 Yes sir Mr Evans 14 THE COURT Yes 15 MR LEVIN It's quite possible But I thought early 16 on had said a date of October 2013 as opposed to January 27 17 2013 when some event happened 18 THE COURT 19 This is the reference to the lulling of the manager of Silk Road 20 MR LEVIN Nods head 21 THE COURT I'm going to go over all those facts now 22 so hopefully that will be clarified if there was a date 23 misstatement 24 25 So I'm not going to go over every single fact but I'm going to go over several of these Mr Bridges Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 16 of 40 1 16 Is it correct that on or about January 25th of 2013 you 2 devised a scheme to defraud and to obtain money and property 3 through false and fictitious representations 4 THE DEFENDANT 5 THE COURT Yes Your Honor Is it correct that you utilized an 6 administrator account on the Silk Web website -- Silk Road 7 website belonging to another individual and not intended for 8 you for your personal use to obtain access to that site 9 10 THE DEFENDANT THE COURT Yes Your Honor All right And are you aware -- and you 11 are aware is it correct in that you agree that the government 12 could prove that Silk Road was a website where illegal goods 13 were posted for sale including narcotics and that payments 14 were accepted on this site in Bitcoin 15 THE DEFENDANT 16 THE COURT Yes Your Honor Is it correct that you used the 17 administrator account to reset passwords for vendor accounts 18 and other accounts to give you access to those accounts and any 19 Bitcoin indie accounts 20 THE DEFENDANT 21 THE COURT Yes Your Honor Is it correct that you moved a total of 22 approximately 20 000 Bitcoin from various Silk Road vendor 23 accounts into a wallet over which you exercised control 24 THE DEFENDANT 25 THE COURT Yes sir Is it correct that the value at that time Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 17 of 40 1 17 of the Bitcoin that was stolen was approximately $350 000 2 THE DEFENDANT 3 THE COURT Yes sir Is it correct that on or about January 26 4 of 2013 you moved the Bitcoin into an account at Mt Gox a 5 digital currency exchange based in Japan 6 THE DEFENDANT 7 THE COURT Yes sir Is it correct that on or about 8 January 27 2013 you attempted to lull the manager of the Silk 9 Road site Ross William Ulbricht also known as Dead Pirate 10 Roberts sic also known as DPR by telling him that you too 11 had had Bitcoin stolen from you 12 THE DEFENDANT 13 THE COURT 14 Yes sir And that this communication took place by way of interstate wire is that correct 15 THE DEFENDANT 16 THE COURT Yes sir And is it correct that the government -- 17 as far as you are concerned the government could prove that 18 Ulbricht was in the Northern District of California on that 19 date when you were in Maryland 20 THE DEFENDANT 21 THE COURT Yes sir Is it correct that between March and May 22 of 2013 you converted the Bitcoin into U S currency and 23 caused wire transfers of money totaling approximately $820 000 24 from the account at Mt Gox into Quantum International 25 Investments LLC an account you controlled as Fidelity Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 18 of 40 1 THE DEFENDANT 2 THE COURT 18 Yes sir Is it correct that on June 2nd of 2014 3 you transferred funds from that Quantum Fidelity account into 4 an account in the joint names of yourself and a person known to 5 the parties 6 THE DEFENDANT 7 THE COURT Yes sir And specifically I'd like to ask you to 8 look at Page 4 of the plea agreement 9 chart at the top which lists various financial transactions 10 11 And that page has a with the dates and amounts listed Is it correct that the funds that are listed on this page 12 in this chart in each of those transactions were proceeds of 13 wire fraud Is that correct 14 THE DEFENDANT 15 THE COURT Yes sir Is it correct that you carried out each 16 of those transactions with the intent to promote ongoing wire 17 fraud -- a wire fraud scheme and also to conceal and disguise 18 the nature location source and ownership as well as the 19 origin of these illegal proceeds 20 THE DEFENDANT 21 THE COURT Yes sir Now during the time that you devised and 22 carried out the fraud and money laundering scheme is it 23 correct that you were a Special Agent with the United States 24 Secret Service and a member of the Electronic Crimes Task 25 Force as well as the Baltimore Silk Road Task Force Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 19 of 40 1 19 Is that correct 2 THE DEFENDANT 3 THE COURT Yes sir And was that task force at that time 4 engaged in investigating Silk Road its vendors and buyers and 5 also Dead Pirate Roberts for which there was an ongoing grand 6 jury investigation in the District of Maryland 7 Is that correct 8 THE DEFENDANT 9 THE COURT 10 Yes sir Okay And you agree that the Baltimore Silk Road grand jury investigation was an official proceeding 11 THE DEFENDANT 12 THE COURT Yes sir Is it also correct that the activities 13 you engaged in obstructed influenced and impeded the Baltimore 14 grand jury related to its Silk Road investigation as well as 15 its resulting case in the District of Maryland against Ulbricht 16 amongst others Is that correct 17 THE DEFENDANT 18 THE COURT That's correct sir And in particular that activity operated 19 to obstruct and impede the ability of the investigation to 20 fully utilize a cooperator's access to Silk Road after the 21 fraud and caused the task force and the grand jury to spend 22 time and effort to investigate the thefts from Silk Road that 23 you had committed and created additional incentive for 24 Ulbricht to attempt to hire someone to kill a cooperator who 25 Ulbricht suspected of committing thefts that you in fact had Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 20 of 40 1 committed 20 Is that right 2 THE DEFENDANT 3 THE COURT Yes sir And it also had the effect is it 4 correct of obstructing influencing and impeding the grand 5 jury investigation into Ulbricht in the District of Maryland 6 THE DEFENDANT 7 THE COURT Yes sir And is it correct that you agree that you 8 acted corruptly in obstructing influencing and impeding the 9 grand jury's Silk Road investigation 10 THE DEFENDANT 11 THE COURT Yes sir Is it correct that by May of 2014 there 12 was also an active San Francisco-based grand jury investigation 13 into potential misconduct by Drug Enforcement Administration 14 Special Agent Carl M Force IV 15 THE DEFENDANT 16 THE COURT 17 Is that correct Yes sir And that the San Francisco grand jury subsequently began to investigate your conduct 18 THE DEFENDANT 19 THE COURT Yes sir And you also agree that the San Francisco 20 grand jury investigation was like the one in Maryland an 21 official proceeding 22 THE DEFENDANT 23 THE COURT Yes sir Is it correct that on or about May 28 of 24 2014 you were interviewed by a Special Agent with the Bureau 25 -- Federal Bureau of Investigation and that you intentionally Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 21 of 40 1 21 misled that agent 2 THE DEFENDANT 3 THE COURT Yes sir Is it correct that on November 13 of 4 2014 you were interviewed by a Special Agent from the 5 Department of Justice Office Inspector General and that you 6 intentionally misled that agent as well 7 THE DEFENDANT 8 THE COURT 9 Yes sir During January and February of 2015 is it correct that you consulted with another employee of the 10 United States Secret Service both before and after that 11 employee had an interview on the subject of the investigation 12 with Special Agents from the Department of Homeland Security 13 Office of Inspector General and the FBI 14 THE DEFENDANT 15 THE COURT 16 17 18 19 Yes sir Is it correct you met with that employee before and after the employee's interview - Reporter interruption THE COURT Oh okay Is it correct that you met with the employee before and 20 after that employee's interview and discussed the subject of 21 the interview and agreed to tell a false consistent story 22 regarding searches conducted on a database controlled by the 23 Financial Crimes Enforcement Network FinCEN 24 THE DEFENDANT 25 THE COURT Yes sir Is it correct that on March 30 of 2015 Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 22 of 40 22 1 in the Northern District of California you misrepresented 2 certain facts to agents with the FBI and the Internal Revenue 3 Service criminal investigations with respect to the full scope 4 of the FinCEN database searches 5 THE DEFENDANT 6 THE COURT Yes sir And is it correct that you agree that 7 each of the interviews and actions described that we have just 8 reviewed were in connection with the San Francisco grand jury 9 investigation 10 THE DEFENDANT 11 THE COURT Yes sir And you further agree that by corruptly 12 engaging another Secret Service agent to tell a false story to 13 federal agents and by lying to federal agents you obstructed 14 influenced and impeded a San Francisco-based grand jury 15 investigation into your criminal conduct and that of former DEA 16 Special Agent Carl M Force IV 17 MR LEVIN Your Honor if I may 18 THE COURT Yes 19 MR LEVIN Again I may have misheard Your Honor 20 believe it's a Secret Service employee to the extent 21 Your Honor said Secret Service agent 22 THE COURT All right 23 MR LEVIN We would only correct that aspect 24 THE COURT Let me go over that again 25 I Is it correct that you -- you further agree that by corruptly encouraging Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 23 of 40 23 1 another Secret Service employee to tell a false story to 2 federal agents and by lying to federal agents yourself that 3 had the effect of obstructing influencing and impeding the 4 San Francisco-based grand jury investigation into your conduct 5 and that of former DEA Special Agent Carl M Force IV 6 THE DEFENDANT 7 THE COURT Yes sir Very well With respect to the charge in 8 the criminal information Count 1 which charges you with a 9 violation of Title 18 United States Code Section 1957 money 10 laundering how do you plead Mr Bridges 11 guilty 12 THE DEFENDANT 13 THE COURT Guilty or not Guilty With respect to Count 2 in the criminal 14 information that charges you with a violation of Title 18 15 United States Code Section 1512 c 2 obstruction of justice 16 how do you plead Guilty or not guilty 17 THE DEFENDANT 18 THE COURT Guilty I find that Mr Bridges has made a 19 knowing intelligent and voluntary waiver of his Constitutional 20 rights and entry of the guilty plea that there is an 21 independent factual basis for each of the elements of each of 22 the charges and that he is therefore adjudged guilty of a 23 violation of Title 18 United States Code Section 1957 money 24 laundering and Title 18 United States Code 25 Section 1512 c 2 obstruction of justice Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 24 of 40 1 2 3 24 I will refer the matter to U S Probation Office for preparation of a presentence report Sentencing date 4 MS HAUN 5 THE CLERK 6 MS HAUN 7 THE CLERK Yes 8 MR EVANS What day is that 9 THE CLERK Tuesday 10 MS HAUN Is it about 70 days Or is it -- December 8th December 8th Your Honor could we request a special 11 setting in the afternoon 12 that time and he would he like to be here as well 13 that likely Mr Levin and Mr Denney will be flying from out of 14 town 15 16 17 18 19 THE COURT I know Mr Frentzen is in trial at And I know Yes Off-the-Record discussion between Defendant and Counsel MR LEVIN I'm sorry what was the date Off-the-Record discussion between counsel THE COURT Well if it's going to be specially set 20 it doesn't have to be on Tuesday 21 particular date someone wants to request 22 travel involved and I can certainly accommodate you 23 24 25 MR LEVIN I'm flexible if there's a I know there is Thank you Your Honor In light of the travel that's involved Monday would work better THE COURT Monday is fine Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 25 of 40 1 MS HAUN 2 THE COURT Yes 3 THE CLERK Looks like -- 4 THE COURT Yes I'm here 5 I'm gone 6 on that date The 7th All right I think That's the week before So the 7th at -- what's -- I'm flexible What time 7 MS HAUN 8 THE COURT 9 Could we set it for 3 00 p m Your Honor Yes 3 00 p m Off-the-Record discussion between counsel 10 MR LEVIN I'm sorry Your Honor 11 THE COURT Okay 12 Off-the-Record discussion between counsel MS HAUN 13 Okay Your Honor For now we would like to 14 set it for 3 00 p m and then it might be that we file a 15 stipulation to adjust not the date but the time THE COURT 16 That's fine 17 flexible 18 in the morning 19 can adjust it accordingly 20 21 25 I think I'm fairly The only thing would be if there is a trial going on And I don't think there is on that date so I MS HAUN Thank Your Honor The government would like to raise one more thing with the Court 22 THE COURT 23 MS HAUN All right Your Honor under the remand statute 18 24 United States Code Section 3143 a detention in this case a 25 remand is not mandatory Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 26 of 40 1 26 However the statute reads that the Court shall order the 2 detention unless the Court finds -- you the Judge -- that 3 there is clear and convincing evidence that the person is not 4 likely -- the Defendant is not likely to flee or pose a danger 5 And so it's on the Court to make that determination 6 And just today Your Honor we had some information come 7 to us that is concerning to the government and we wanted to 8 raise it with the Court 9 information today And unfortunately we just got this We have been exploring it this afternoon 10 And that is that it's come -- and Pretrial Services we 11 have also just conferred with and they had no knowledge of 12 this either 13 And the information is that the Defendant has been 14 actively trying to change his name and Social Security number 15 in the state of Maryland 16 executed his plea agreement 17 18 Since the -- since the time that he And that's very concerning to the government Your Honor And we wanted to bring that to the Court's attention 19 THE COURT Mr Levin 20 MR LEVIN Thank you Your Honor 21 It's my understanding that during his service as a Secret 22 Service agent Mr Bridges' identity was compromised on a few 23 occasions 24 Office of Personnel Management indicating that -- I believe 25 several of us received that letter that either work or worked And then this summer he received a letter from the Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 27 of 40 27 1 for the government -- indicating that there was hacking 2 involved and people's personal information was jeopardized 3 In light of -- it was only after that letter in light of 4 that letter and all the other times his identity has been 5 compromised that Mr Bridges I believe it was on -- well 6 petitioned the court that -- 7 THE DEFENDANT 8 MR LEVIN 9 Correct He petitioned the court so it's a matter of public record for a name change Keeping the first name 10 and taking -- petitioning the court to take a family member's 11 last name is my understanding 12 13 THE DEFENDANT I petitioned the court to take my wife's name 14 MS HAUN 15 some additional information 16 wife's last name -- which he married the wife during the 17 pendency of this case as the Court probably knows 18 first name was nothing remotely resembling anything having to 19 do with the wife 20 Your Honor actually the government has First of all the last name the But the It was a very odd name Also although the Defendant is now saying that it was all 21 public record he actually made several motions to seal or 22 limit inspection of the case record 23 I think the most concerning thing here for the 24 government's perspective is that he failed to notify his 25 pretrial services officer either here or in Maryland And to Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 28 of 40 1 say the least they were very surprised to learn this 2 information today 3 can procure travel documents in other names 4 5 28 And it's concerning because obviously one Also the change of the -- the petition for the change of Social Security numbers 6 But at the time of Mr Bridges when he presented himself 7 to the Court on these charges back in March it was discovered 8 that he had no fewer than four weapons in his possession one 9 of which was an assault weapon The government is of the view 10 that that was an illegally-possessed weapon 11 been now accounted for and are in the custody of the FBI 12 And those have However it is concerning the Defendant is trying to 13 change his name to something that is completely different 14 It's not a name change that has like I said any resemblance 15 to just his wife's name or his own name MR LEVIN 16 Your Honor as I was in the process of 17 relating the facts to the Court in fact Mr Bridges 18 volunteered on the day he came out to California for his 19 initial appearance that he had firearms in his home 20 volunteered that information 21 had them 22 turned them over 23 enforcement 24 initial appearance 25 He had them He It wasn't brought out that he He volunteered it and he voluntarily I believe they are in the hands of law And they were transferred within days of the If my memory serves me correctly That's a separate issue He was released At the time -- Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 29 of 40 29 1 at the time of the initial appearance and at the time of 2 Mr Bridges' release the government was aware of the presence 3 of firearms 4 So that really has no part in today's analysis With respect to the name change once -- it was 5 Mr Bridges' intention to notify Pretrial once the petition had 6 been granted 7 wrong in thinking Pretrial only wanted to know once it was 8 changed that is when he intended to disclose it to Pretrial 9 It was pending And whether he was right or But the fact of the matter remains Your Honor 10 Mr Bridges has been fully compliant with all the terms and 11 conditions of his pretrial release 12 pretrial officer can certainly tell the Court that he has been 13 going to alcohol abuse counseling even more than what was 14 required 15 the court hearings 16 that one would expect one might -- He has -- and I think the And he has been compliant with that He's pled guilty 17 THE COURT 18 being supervised in Maryland 19 MS HAUN 20 MR EVANS Correct 21 THE COURT Okay He's come to He's done everything He's currently located in Maryland he is Is that right Correct Your Honor Explain for me again I'm not sure 22 I understand this reason that you've articulated Mr Levin 23 for why he's changed his identity 24 25 I mean okay there was a hacking incident And those of us who work for the Federal Government have had to deal with Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 30 of 40 1 that 2 identity or seek to change it 3 MR LEVIN 30 I'm not clear on why that's leading him to change his Well this was not the first time that 4 Mr Bridges' identity had been compromised 5 happened a few times during the course of his employment with 6 Secret Service 7 name 8 linked to his old Social Security number And he just decided that he should change his And the Social Security number that he applied for is THE COURT 9 But it had So You understand that the government's 10 concerned 11 risk activity of this kind sends up a lot of red flags that 12 even if it had nothing to do with it I -- I am not surprised 13 that they are bringing this to my attention is the bottom 14 line 15 perhaps provide an opportunity to utilize that new identity to 16 go elsewhere 17 I mean when we're concerned with looking at flight Because if it's -- if it was carried forward it would So it is a cause of considerable concern And so I suppose my question to you is What's going to 18 alleviate that concern for me 19 shouldn't be quite distressed by this and agree with the 20 government that it's -- we -- it's enough of a red flag that 21 I've got to do something about it 22 THE DEFENDANT 23 24 25 I mean give me a reason why I Could I speak directly to the Court Your Honor THE COURT Why don't you talk to your counsel about how to answer the question Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 31 of 40 1 31 Off-the-Record discussion between Defendant and Counsel MR LEVIN 2 Your Honor having consulted with 3 Mr Bridges it's my understanding Mr Bridges consulted an 4 attorney prior to filing the documents 5 attorney's counsel is what guided him to file the documents 6 that he filed THE COURT 7 And his -- his We don't know how -- what else he told 8 the attorney about his situation 9 want to get -- I mean that simply gives me some facts as to 10 what he was doing 11 going on at this time 12 But I -- I suppose I don't I -- I still find it curious why this is Let me now ask the government a question Were I inclined 13 not to require remand at this time are there some additional 14 conditions that you think would be appropriate such as there 15 will be no -- any effort at identity adjustment is to be 16 curtailed and something you know along those lines 17 I mean -- go ahead 18 MS HAUN 19 22 Not curtailed but absolutely forbidden THE COURT 20 21 Yes Your Honor Forbidden is another way to say it yes MS HAUN Just a couple things The reason I 23 mention the weapons is not because I'm proposing the danger to 24 the community 25 identity if he had been successful in that that raises the I'm proposing that if he's procuring a new Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 32 of 40 32 1 possibility he could go out under this new identity and procure 2 weapons for example 3 THE COURT 4 MS HAUN Inaudible But really the government's concern is he 5 didn't just petition for the name change once 6 understanding from the Circuit Court of Maryland -- and again 7 I apologize for raising this today 8 came to us this morning and we wanted to run down and make 9 sure that we were gathering the documents Our This information literally Had we known about 10 this before from the Defendant we certainly would have raised 11 this issue with -- through Counsel 12 But I think that we understand from the Circuit Court of 13 Maryland that several name-change petitions filed by 14 Mr Bridges were denied and that this is the third according 15 to the information we've received from them today 16 the docket printed out but we haven't been able to verify 17 three 18 THE COURT 19 MS HAUN So we have Okay But we would -- so on that basis we would 20 seek remand 21 Defendant today then we would seek some additional conditions 22 I know that Pretrial Services is here and they have If the Court is not inclined to remand the 23 proposed possibly a curfew 24 think that some of those conditions 25 absolutely no attempts to change his identity Some electronic monitoring So I But as Your Honor said Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 33 of 40 1 THE COURT Right Let me follow up on your 2 question on your point you just made with Mr Levin 3 there been numerous efforts to change identity 4 MR LEVIN 33 Have My understanding Your Honor is that 5 Mr Bridges failed to check certain blocks such as he did not 6 check the block that asked whether or not he had ever been 7 convicted of a sex offense or a child -- child -- 8 9 10 11 THE DEFENDANT If I was a convicted sexual offender So the court automatically denied and I had to resubmit it's all on the same case THE COURT So It's not an additional case Well so let me confirm with you It's 12 not -- there weren't different names and different identities 13 and it would be denied and you tried a different one 14 all a part of one application process where denials were 15 occurring and revised forms were resubmitted 16 understanding 17 18 19 20 21 22 23 MR LEVIN It was Is that your That's my understanding Your Honor Off-the-Record discussion between Defendant and Counsel THE COURT Okay Our Pretrial Service officer you didn't come in from Maryland you're here PRETRIAL SERVICES OFFICER WILSON Right That's correct Brad Wilson U S Pretrial Services San Francisco office THE COURT Right Ms Haun mentioned some 24 additional conditions and I certainly think a condition would 25 be that the -- that Mr Bridges would -- is forbidden from Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 34 of 40 34 1 making any effort to change either his name or any personal 2 identifying information including but not limited to Social 3 Security and the like 4 5 6 What other conditions were you thinking of with respect to possibly electronic monitoring and -PRETRIAL SERVICES OFFICER WILSON Your Honor we 7 recommend that possibly the Defendant be placed on a location 8 monitoring with a curfew from 10 00 p m to 6 00 a m daily 9 THE COURT Have you talked with your counterparts in 10 Maryland about just the feasibility of doing that 11 sometimes it depends upon the housing arrangement and all the 12 rest of it I know 13 PRETRIAL SERVICES OFFICER WILSON 14 to the immediacy of the issue I haven't had a chance 15 THE COURT Right Okay Unfortunately due Well what I'm inclined to 16 do -- I do find this very troubling 17 this point accept the representation that this was while not 18 what should have been done not indicative of some effort to 19 begin a process of -- of fleeing 20 But I am prepared to at So I am not going to remand the Defendant but I am going 21 to add conditions 22 absolutely forbidden from and curtailing any ongoing efforts 23 and not engaging in any further efforts to in any way change 24 identity or identifying information 25 And I think number one forbidden Is that understood -- Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 35 of 40 1 THE DEFENDANT 2 THE COURT 3 THE DEFENDANT 4 THE COURT Yes sir -- Mr Bridges Nods head No matter what reasoning you may have 5 you can't do it 6 electronic monitoring and the curfew suggestion 7 8 9 35 And number two I'm going to adopt the But implementing that I'm not sure how we do that because Maryland is involved and somebody has to talk to Maryland So how do we go about -- it's been a while since I used to 10 put pretrial conditions in place so I frankly don't remember 11 exactly how we do it 12 MS HAUN What do you need from me to do it Your Honor I would propose that simply 13 the government come up with a proposed order that we submit to 14 you today 15 THE COURT 16 MS HAUN 17 THE COURT 18 MS HAUN Okay And that you issue an order -All right -- directing these conditions The one 19 other condition I would like to revisit is -- and I'm not 20 asking for a new condition I just want the Court to be aware 21 of a condition of pretrial release that Judge James back in 22 March -- or was it April 1st 23 April 1st Judge James ordered a condition related to the 24 Defendant's use of the computer and access to the computer 25 It was either March 30th or And I wanted to make this Court aware of that and so that Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 36 of 40 36 1 you could underscore that that condition still pertains And 2 if we could talk about that condition here today 3 think frankly that should also -- that would make the 4 government feel better 5 THE COURT 6 MS HAUN Because I All right If the Court is not willing to remand the 7 Defendant it would give the government some comfort to know 8 that the Defendant has curtailed ability to use the computer THE COURT 9 All right Let's see if I have the 10 actual -- Judge James' actual order 11 release conditions 12 that Judge James imposed 13 I'm not sure I have her So I don't have the particular language But let me do this Mr Bridges one of the conditions of 14 your pretrial release as I understand it that were imposed by 15 Judge James was that you -- there were restrictions on your 16 computer use 17 Was it a complete restriction or -MR LEVIN 18 No Your Honor I believe it had to do 19 prohibiting Mr Bridges from accessing any encrypted sites 20 believe that was the restriction that was placed MS HAUN 21 It was a little broader than that 22 actually 23 Your Honor 24 find it a little vague 25 I It was any kind of so-called -- and you know what Since we're talking about this today I frankly I think in the proposed order the government will work Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 37 of 40 1 with Mr Levin today to come up with some language THE COURT 2 3 37 All right Oh here it is I actually have it MS HAUN 4 It's deep web or dark net sites the 5 Defendants is prohibited from accessing 6 government would also propose he can't use any third party to 7 access those sites on his behalf 8 condition right now 9 THE COURT And I don't think that's a For example his wife Well I -- that doesn't sound -- that 10 sounds reasonable to me 11 third party from their own conduct 12 MS HAUN 13 THE COURT As long as it doesn't preclude any But I'm looking at her release conditions 15 reference to computer use 17 18 Because we can't do that Nods head 14 16 But I think the Frankly I don't see anything on here that makes It has the surrendering of the four firearms No access to any proceeds of fraud to include Bitcoin Okay Well it says 19 No access to any proceeds of fraud to include 20 Bitcoin and to include Quantum LLC or deep web 21 services such as 'TOB' network 22 I don't know what that is I can't see it on here So if 23 you want to propose some computer restriction I am prepared to 24 adopt it 25 MS HAUN Nods head Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 38 of 40 38 1 THE COURT 2 get something to me 3 Mr Levin and hopefully you won't have a particular problem 4 with it Obviously talk through it with But when are you going to present that to me MS HAUN 5 So your suggestion is you are going to Your Honor I think we could present that 6 by the close of business today maybe give or take some time 7 depending on how long our conversation with Mr Levin goes 8 THE COURT 9 MS HAUN 10 THE COURT MR LEVIN not an issue All right Well I will be here Craft something MS HAUN 17 18 Tomorrow morning early flight so that's Thank you THE COURT 15 16 What's the situation Mr Bridges -- when's he -- he's here 13 14 But I'm hopeful we could get that to you by today 11 12 All right Some point tonight Your Honor I guess I would say THE COURT 19 Hopefully not tonight but at some point 20 promptly I will have something in front of me to sign 21 I'll do that 22 conditions And And on that basis I will maintain the release 23 And just to underscore this discussion Mr Bridges all 24 of the conditions that are already in place remain completely 25 in place So we're adding conditions Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 39 of 40 1 THE DEFENDANT 2 THE COURT Yes sir So this is not a new set in that sense 3 And I want you to be quite aware of the fact that all the 4 existing conditions continue to apply 5 discussing some additional ones 6 supplemental order as opposed to a refashioned order 7 MS HAUN 39 And then we will be Because you're proposing in a Correct Your Honor It would simply say 8 All prior conditions pertain and in addition the following 9 additional conditions 10 11 THE COURT looking for that All right Okay Well I will be And see you then 12 MS HAUN 13 MR LEVIN Thank you Your Honor 14 THE COURT Thank you 15 16 17 18 19 20 21 22 23 24 25 Thank you Your Honor Proceedings concluded Case 3 15-cr-00319-RS Document 132 Filed 04 02 16 Page 40 of 40 1 2 3 CERTIFICATE OF REPORTER 4 5 I BELLE BALL Official Reporter for the United States 6 Court Northern District of California hereby certify that the 7 foregoing is a correct transcript from the record of 8 proceedings in the above-entitled matter 9 10 s Belle Ball____________________ 11 Friday April 1 2016 12 Belle Ball CSR 8785 CRR RDR 13 14 15 16 17 18 19 20 21 22 23 24 25 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