When Bitcoin took off, he and Craig decided to skim some bitcoin off the top, and got caught. Who knows what they were thinking. Kleiman was deemed not suitable for rehabilitation and deep sixed. Craig got an offer he couldn't refuse, and he didn't refuse it. He ended up getting farmed out to asis to be a figurehead for their branch of the bitcoin project.
All very hush hush, so don't tell anybody, but there are a few dark websites which give details.