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Alleged operator of illegal-drug bazaar Silk Road 2.0 arrested

A 26-year-old computer programmer in San Francisco is accused of running the illicit site, which feds say followed a similar business model to its shuttered predecessor.

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The home page of Silk Road 2.0, which has been shut down. US Immigration and Customs Enforcement

A little more than a year ago, federal law enforcement authorities shut down the online illegal-drug marketplace Silk Road and arrested its alleged operator. But the very next month, a nearly identical site, Silk Road 2.0, opened for business.

Today, federal officials announced they have arrested a man in connection with the operation and ownership of Silk Road 2.0. Twenty-six-year-old computer programmer Blake Benthall, aka "Defcon," was arrested Wednesday in San Francisco.

He appeared Thursday in federal court, where Assistant US Attorney Kathryn Haun told the judge that Benthall is a "severe flight risk," according to the San Francisco Chronicle. Benthall is expected to be transferred to New York in the custody of US Marshals Service. Assistant Federal Public Defender Daniel Blank, who is representing Benthall, said the transfer is likely to occur within the next two weeks, the report said. Blank, who is in court, did not immediately respond to a request for comment.

The online marketplace has enabled more than 100,000 people to buy and sell illegal drugs, according to a statement from the US Attorney's Office. Silk Road 2.0 operated much the same way as its predecessor did, according to a complaint unsealed in a Manhattan federal court on Thursday.

In particular, like its predecessor, Silk Road 2.0 operated exclusively on the "Tor" network and required all transactions to be paid for in Bitcoins in order to preserve its users' anonymity and evade detection by law enforcement. Likewise, the offerings on Silk Road 2.0 consisted overwhelmingly of illegal drugs, which were openly advertised as such on the site. As of October 17, 2014, Silk Road 2.0 had over 13,000 listings for controlled substances.

The site also listed other illicit goods and services for sale, including computer-hacking tools and services and fake identification documents, according to the complaint (PDF).

After its launch last year, the Silk Road 2.0 log-in page took a jab at law enforcement by copying the Web site seizure notice used by the FBI. All Things Vice

Benthall has been charged with conspiring to commit narcotics trafficking and computer hacking, conspiring to traffic in fraudulent identification documents, and one count of money laundering conspiracy.

"Let's be clear - this Silk Road, in whatever form, is the road to prison," Preet Bharar, U.S. attorney for the Southern District of New York, said in the statement.

The investigation that led to Benthall's arrest involved the US Immigration and Customs Enforcement's Homeland Security Investigations, the FBI and the European Police. A special agent with HSI infiltrated the support staff for Silk Road 2.0, according to the statement.

"The FBI worked with law enforcement partners here and abroad on this case and will continue to investigate and bring to prosecution those who seek to run similar black markets online," said George Venizelos, assistant director in charge of the FBI New York.

Last fall, federal law enforcement seized the Silk Road domain and arrested Ross Ulbricht, who allegedly ran the site under the pseudonym Dread Pirate Roberts. Silk Road allowed anonymous buyers using the secure Tor browser to purchase and sell drugs with bitcoin. Ulbricht's arrest led to the arrests of eight other people who allegedly were also Silk Road's main operators.

CNET's Donna Tam contributed to this report.

Update, 2:55 p.m. PT: This story has been updated throughout with additional details.