FBI seizes online black market Silk Road, arrests owner
The US Federal Bureau of Investigation (FBI) has seized Deep Web Bitcoin-based black market Silk Road, an anonymous online marketplace, and arrested alleged owner Ross William Ulbricht, aka "Dread Pirate Roberts".
The US Federal Bureau of Investigation (FBI) has seized Deep Web Bitcoin-based black market Silk Road, an anonymous online marketplace, and arrested alleged owner Ross William Ulbricht, aka "Dread Pirate Roberts".
The FBI arrested the alleged owner of Silk Road, 29-year-old Ross William Ulbricht, on Tuesday, 1 October, according to court filings, and shuttered the Deep Web marketplace pending further investigation.
The online marketplace, which could only be accessed using a secure Tor browser, was often referred to as the Amazon or eBay for drugs — it allowed users to purchase illicit substances (as well as some legal goods) anonymously using online crypto-currency Bitcoin.
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Ulbricht stands accused of narcotics trafficking, computer hacking and money laundering, according to a document outlining the FBI's complaints posted online by journalist Brian Krebs.
FBI special agent Christopher Tarbell wrote, "The government's investigation has revealed that, during its two and a half years in operation, Silk Road has been used by several thousand drug dealers and other unlawful vendors to distribute hundreds of kilograms of illegal drugs and other illicit goods and services to well over 100,000 buyers and to launder hundreds of millions of dollars deriving from these unlawful transactions."
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In the time since its launch in February 2011, Silk Road has generated over 9.5 million Bitcoins in revenue from 1,229,465 transactions, collecting 614,305 Bitcoins in commissions. Ulbricht was found in possession of 26,000 Bitcoins, totalling a market value of around US$3.6 million at time of arrest.
According to Tarbell's report, which covers the extensive FBI operation in detail, Ulbricht also allegedly used his marketplace to hire a hitman to murder a user who had levelled threats of blackmail, telling Ulbricht that he would publish names and addresses of Silk Road vendors unless Ulbricht paid him US$500,000. In the exchange with the hitman, Ulbricht mentioned that he had previously "had a clean hit done"; later, the hitman told him the job had been successful. However, since the FBI could find no evidence tracing a murder back to Ulbricht, he is not being charged on that count.
You can read the full complaint here.