Home> U.S. Silk Road Website Dealt Drugs, Guns, Assassins for Bitcoins, FBI Says

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A billion dollar black market website allowed people to use Bitcoin digital currency to buy guns, drugs or hire assassins, according to a federal complaint released today. The complaint charges Ross William Ulbricht, 29, with a battery of conspiracy crimes allegedly committed through his Silk Road website, which has been called the "Amazon of illegal drugs" or the "eBay of illicit substances." Silk Road was described by the FBI in the criminal complaint as "the most sophisticated and extensive criminal marketplace on the Internet." The site's illicit sales revenue totaled 9.5 million Bitcoins and commissions totaled over 600,000 Bitcoins, the complaint states. The value of the e-currency has fluctuated, however, authorities estimated those figures today are equivalent to $1.2 billion in sales and $80 million in commissions. Until the announcement today, the person who ran the website was only known by the pseudonym "Dread Pirate Roberts," a reference to a mysterious pirate in the movie "Princess Bride." Ulbricht is being charged with narcotics trafficking conspiracy, computer hacking conspiracy and money laundering conspiracy. The complaint alleges that in March, Ulbricht solicited a Silk Road user to "execute a murder-for-hire of another Silk Road user who was threatening to release the identities of thousands of users of the site." The website, which authorities said operated on an encrypted system that allowed users to access the internet anonymously, allegedly sold illegal drugs, including heroin, cocaine, LSD and methamphetamine. The site also allegedly offered other illicit listings, including firearms, computer and ATM hacking lessons and assassins for hire. The federal investigation alleged that during its two and a half years in operation, the site had been used by several thousand drug dealers, who in turn distributed the goods to "well over a hundred thousand buyers" and laundered hundreds of millions of dollars from the transactions.

http://abcnews.go.com/US/silk-road-website-dealt-drugs-guns-assassins-bitcoins/story?id=20446005

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Alleged Silk Road Drug Lord Led Double Life as Entrepreneur The alleged Internet drug lord who created an online black market dubbed the "Amazon of illegal drugs" by the FBI led a double life, cultivating an outward appearance of a clean-cut entrepreneur while secretly helping to shuffle over $1 billion in drugs via his website, authorities and his family said. Ross William Ulbricht, 29, allegedly ran Silk Road, which the FBI called "the most sophisticated criminal marketplace on the Internet," where thousands sold cocaine, meth, MDMA and other drugs. The FBI arrested Ulbricht on Tuesday afternoon at a San Francisco library and the website was shut down, authorities said. Ulbricht is being charged with narcotics trafficking conspiracy, computer hacking conspiracy, and money laundering conspiracy. From February of 2011 to July of 2013, Silk Road did $1.2 billion worth of business, according to the FBI. But members of his family have said that they had no idea what he was doing. His half-brother Travis Ulbricht told Forbes that he found the news of the arrest "somewhat shocking." "He's an exceptionally bright and smart kid. He's always been upstanding and never had any trouble with the law that I knew of," he said. Silk Road Website Dealt Drugs, Guns, Assassins for Bitcoins, FBI Says. Read more here. Ulbricht was even a public social media user. A cursory search brings up his Facebook page, and conversations he had with close friend René Pinnell were posted on YouTube, though they have now been removed. According to his LinkedIn profile, which features a clean-cut headshot, he is a 2010 Penn State graduate and investment adviser and entrepreneur who "studied physics in college and worked as a research scientist for five years," until moving in a new direction. "Now, my goals have shifted," he wrote on his LinkedIn page. "I want to use economic theory as a means to abolish the use of coercion and aggression amongst mankind. Just as slavery has been abolished most everywhere, I believe violence, coercion and all forms of force by one person over another can come to an end." Silk Road Arrest Shines Light on 'Dark Web.' Read more here. Ulbricht lived with René Pinnell in an apartment on Hickory Street in San Francisco's Hayes Valley neighborhood when he first moved to California from Texas, according to the FBI. The two have been friends since the age of 10, While many questions remain about the seemingly double life led by Ulbricht, just as many are being asked about how and why he was caught. At the time of his arrest, Ulbricht had his laptop with him, indicating that he may have been conducting business in plain sight -- literally within a government building. This could be a hint to what one digital security expert said may have led to Ulbricht's undoing: cheapness. Digital Citizens Alliance Fellow Garth Bruen told ABCNews.com that he's been pouring over the complaint against Ulbricht since it was released, and he said it seems the alleged drug kingpin's reluctance to spend money on shielding his dealings did him in. "He made what I would say were extremely amateur mistakes. He had fake IDs shipped to his home address. I can't think of anything more bone-headed," Bruen said. "Silk Road sold access to private anonymous mail drops, yet he wouldn't spend the money to do it himself." Ulbricht was confronted by U.S. Homeland Security officials in July after seizing a shipment of fake IDs that used Ulbricht's photo. Ulbricht had a reputation for being very miserly with his Silk Road employees, especially with those he was entrusting secrets to, Bruen said. "The fact that he was sharing an apartment to save money is kind of shocking to me, when he could have rented his own house. He was exposing himself to other people," he said. According to the FBI complaint, Ulbricht even complained about the price when he was allegedly attempting to hire a hit man to murder someone who was planning to expose anonymous online identities. "He was haggling about the price of a hit man," Bruen said. "That's a dangerous step to take." But it may have been not following his own advice that led to his capture. "They haven't been caught yet, so they think they won't be caught," Bruen said. "He was cheap. If he had spent money on creating layers of privacy, it would have been harder to get caught."