FBI Arrests Federal Employee Selling Restricted Data on Nuclear Submarines for Cryptocurrency

A U.S. government employee has been arrested on espionage-related charges after he attempted to sell restricted data on the design of nuclear-powered warships to a foreign government. The federal employee asked to be paid in monero cryptocurrency. “I am very aware of the risks of blockchain analysis of bitcoin and other cryptocurrencies, and believe monero gives both of us excellent deniability,” he told an undercover FBI agent.

The U.S. Department of Justice (DOJ) announced Sunday that an employee of the Department of the Navy, who sold restrictive data for cryptocurrency, has been arrested on espionage-related charges.

Jonathan Toebbe, who served as a nuclear engineer, was assigned to the Naval Nuclear Propulsion Program, also known as Naval Reactors. He held an active national security clearance through the U.S. Department of Defense, giving him access to restricted information.

He and his spouse, Diana Toebbe, “sold information known as Restricted Data concerning the design of nuclear-powered warships to a person they believed was a representative of a foreign power,” the DOJ explained, adding:

In actuality, that person was an undercover FBI agent. The Toebbes have been charged in a criminal complaint alleging violations of the Atomic Energy Act.

“The complaint charges a plot to transmit information relating to the design of our nuclear submarines to a foreign nation,” said Attorney General Merrick B. Garland.

Toebbe directed the undercover FBI agent to pay him in monero (XMR) cryptocurrency. According to the complaint, he told the FBI agent:

I will give you a monero address … I am very aware of the risks of blockchain analysis of bitcoin and other cryptocurrencies, and believe monero gives both of us excellent deniability.

The first sale took place in West Virginia in June. The undercover agent sent the nuclear engineer $10K in monero as “good faith” payment and $20K more in the privacy coin after receiving an SD card containing Restricted Data related to submarine nuclear reactors.

The couple sold another SD card containing Restricted Data to the undercover agent in August for $70,000 in monero, bringing the total amount paid to date to $100,000.

According to the DOJ, “The FBI arrested Jonathan and Diana Toebbe on Oct. 9, after he placed yet another SD card at a pre-arranged ‘dead drop’ at a second location in West Virginia.”

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