Ross Ulbricht, aka Dread Pirate Roberts, Sentenced in Manhattan Federal Court to Life in Prison — FBI May 29, 2015 Ross Ulbricht, aka Dread Pirate Roberts, Sentenced in Manhattan Federal Court to Life in Prison Preet Bharara, the United States Attorney for the Southern District of New York, announced that ROSS ULBRICHT, a/k/a “Dread Pirate Roberts,” was sentenced today in Manhattan federal court to life in prison in connection with his operation and ownership of Silk Road, a hidden website designed to enable its users to buy and sell illegal drugs and other unlawful goods and services anonymously and beyond the reach of law enforcement between January 2011 and October 2013. ULBRICHT was found guilty of each of the seven charges he faced on February 5, 2015, following a four-week jury trial. U.S. District Judge Katherine B. Forrest imposed today’s sentence. Manhattan U.S. Attorney Preet Bharara said: “Make no mistake: Ulbricht was a drug dealer and criminal profiteer who exploited people’s addictions and contributed to the deaths of at least six young people.

Ulbricht went from hiding his cybercrime identity to becoming the face of cybercrime and as today’s sentence proves, no one is above the law.” According to the evidence presented at trial, statements made during other public proceedings including today’s sentencing, and other court documents: ULBRICHT created Silk Road in January 2011, and owned and operated the underground website until it was shut down by law enforcement authorities in October 2013. Silk Road emerged as the most sophisticated and extensive criminal marketplace on the Internet, serving as a sprawling black-market bazaar where unlawful goods and services, including illegal drugs of virtually all varieties, were bought and sold regularly by the site’s users. While in operation, Silk Road was used by thousands of drug dealers and other unlawful vendors to distribute hundreds of kilograms of illegal drugs and other unlawful goods and services to more than 100,000 buyers, and to launder hundreds of millions of dollars deriving from these unlawful transactions. ULBRICHT deliberately operated Silk Road as an online criminal marketplace intended to enable its users to buy and sell drugs and other illegal goods and services anonymously and outside the reach of law enforcement. ULBRICHT sought to anonymize transactions on Silk Road in two principal ways.

First, ULBRICHT operated Silk Road on what is known as “The Onion Router,” or “Tor” network, a special network of computers on the Internet, distributed around the world, designed to conceal the true IP addresses of the computers on the network and thereby the identities of the networks’ users. Second, ULBRICHT designed Silk Road to include a Bitcoin-based payment system that served to facilitate the illegal commerce conducted on the site, including by concealing the identities and locations of the users transmitting and receiving funds through the site. The vast majority of items for sale on Silk Road were illegal drugs, which were openly advertised as such on the site. As of September 23, 2013, the Silk Road home page displayed nearly 13,000 listings for controlled substances, listed under such categories as “Cannabis,” “Dissociatives,” “Ecstasy,” “Intoxicants,” “Opioids,” “Precursors,” “Prescription,” “Psychedelics,” and “Stimulants.” From November 2011 to September 2013, law enforcement agents made more than 60 individual undercover purchases of controlled substances from Silk Road vendors.

These purchases included heroin, cocaine, ecstasy, and LSD, among other illegal drugs, and were filled by vendors believed to be located in more than ten different countries, including the United States, Germany, the Netherlands, Canada, the United Kingdom, Spain, Ireland, Italy, Austria, and France. The narcotics distributed on Silk Road have been linked to at least six overdose deaths across the world. These overdose deaths included Jordan M., a 27-year old Microsoft employee who was found unresponsive in front of his computer, which was logged onto Silk Road at the time, and died as a result of heroin and other prescription drugs that he had ordered from Silk Road. Preston B., from Perth, Australia, and Alejandro N., from Camino, California, both 16 years old, died as a result of taking 25i-NBOMe, a powerful synthetic drug designed to mimic LSD (commonly referred to as “N-Bomb”), which was purchased from Silk Road.

Additional victims included Bryan B., a 25-year old from Boston, Massachusetts, and Scott W., a 36-year old from Australia, who both died as a result of heroin purchased from Silk Road, and Jacob B., a 22-year old from Australia, who died from health complications that were aggravated by the use of drugs purchased from Silk Road. In addition to illegal narcotics, other illicit goods and services were openly bought and sold on Silk Road. For example, as of September 23, 2013, there were: 159 listings under the category “Services,” most of which offered computer hacking services, such as a listing by a vendor offering to hack into social networking accounts of the customer’s choosing; 801 listings under the category “Digital goods,” including malicious software, hacked accounts at various online services, and pirated media content; and 169 listings under the category “Forgeries,” including offers to produce fake driver’s licenses, passports, Social Security cards, utility bills, credit card statements, car insurance records, and other forms of false identification documents.

Using the online moniker “Dread Pirate Roberts,” or “DPR,” ULBRICHT controlled and oversaw every aspect of Silk Road, and managed a staff of paid, online administrators and computer programmers who assisted with the day-to-day operation of the site. Through his ownership and operation of Silk Road, ULBRICHT reaped commissions worth more than $13 million generated from the illicit sales conducted through the site. ULBRICHT also demonstrated a willingness to use violence to protect his criminal enterprise and the anonymity of its users, soliciting six murders-for-hire in connection with operating the site, although there is no evidence that these murders were actually carried out. * * * ULBRICHT, 31, of San Francisco, California, was convicted of seven offenses after a four-week jury trial: distributing narcotics, distributing narcotics by means of the Internet, conspiring to distribute narcotics, engaging in a continuing criminal enterprise, conspiring to commit computer hacking, conspiring to traffic in false identity documents, and conspiring to commit money laundering. In addition to the life sentence prison term, ULBRICHT was ordered to forfeit $183,961,921.

In imposing today’s sentence, Judge Forrest said: “There must be no doubt that lawlessness will not be tolerated. There must be no doubt that no one is above the law—no matter one’s education or privileges. All stand equal before the law. There must be no doubt that you cannot run a massive criminal enterprise and because it occurred over the Internet minimize the crime committed on that basis.” Mr. Bharara praised the outstanding investigative work of the Federal Bureau of Investigation and its New York Special Operations and Cyber Division, as well as the outstanding investigative work of the DEA’s New York Organized Crime Drug Enforcement Strike Force, which comprises agents and officers of the DEA, the IRS, the New York City Police Department, U.S. Immigration and Customs Enforcement’s (“ICE”) Homeland Security Investigations (“HSI”), the New York State Police, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Secret Service, the U.S. Marshals Service, Office of Foreign Assets Control, and NY Department of Taxation. Mr. Bharara also thanked the ICE-HSI Chicago-O’Hare office for its assistance and support, as well as the Department of Justice’s Computer Crime and Intellectual Property Section and Office of International Affairs.

Additionally, Mr. Bharara praised the foreign law enforcement partners whose contributions to the success of the investigation and prosecution have been invaluable, namely, the Reykjavik Metropolitan Police of the Republic of Iceland, and the French Republic’s Central Office for the Fight Against Crime Linked to Information Technology and Communication. The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys Serrin Turner and Timothy T. Howard are in charge of the prosecution, and Assistant United States Attorney Christine Magdo is in charge of the forfeiture aspects of the case. This content has been reproduced from its original source . Section Links Meet The Dread Pirate Roberts, The Man Behind Booming Black Market Drug Website Silk Road Meet The Dread Pirate Roberts, The Man Behind Booming Black Market Drug Website Silk Road {{article.article.images.featured.caption}} Opinions expressed by Forbes Contributors are their own. Full Bio The author is a Forbes contributor. The opinions expressed are those of the writer. Loading ... Loading ... This story appears in the {{article.article.magazine.pretty_date}} issue of {{article.article.magazine.pubName}}. Subscribe An entrepreneur as professionally careful as the Dread Pirate Roberts doesn't trust instant messaging services. Forget phones or Skype.

At one point during our eight-month preinterview courtship, I offer to meet him at an undisclosed location outside the United States. "Meeting in person is out of the question," he says. "I don't meet in person even with my closest advisors." When I ask for his name and nationality, he's so spooked that he refuses to answer any other questions and we lose contact for a month. All my communications with Roberts are routed exclusively through the messaging system and forums of the website he owns and manages, the Silk Road. Accessing the site requires running the anonymity software Tor, which encrypts Web traffic and triple-bounces it among thousands of computers around the world. Like a long, blindfolded ride in the back of some guerrilla leader's van, Tor is designed to prevent me--and anyone else--from tracking the location of Silk Road's servers or the Dread Pirate Roberts himself. “The highest levels of government are hunting me,” says Roberts. “I can’t take any chances.” If Roberts is paranoid, it's because very powerful people really are out to get him.

In the last two and a half years Silk Road has grown into the Web's busiest bazaar for heroin, methamphetamines, crack, cocaine, LSD, ecstasy and enough strains of marijuana to put an Amsterdam coffee shop to shame. The Drug Enforcement Administration won't comment on whether it's investigating Silk Road but wrote in a statement that it's aware of the site and is "very proactive in keeping abreast" of the digital underground's "ever-evolving technological advancements." Senator Chuck Schumer has demanded Silk Road be shut down and called it "the most brazen attempt to peddle drugs online that we have ever seen ... by light-years." Anyone can download and run Tor, exchange some dollars or euros for the digital currency Bitcoin and go shopping on Silk Road for drugs that are vacuum-sealed and discreetly mailed via the U.S. Postal Service, right under the federal government's nose. By the measure of Carnegie Mellon researcher Nicolas Christin, Roberts' eBay-like service was grossing $1.2 million a month in the first half of 2012. Since then the site has doubled its product listings, and revenue now hits an annual run-rate of $30 million to $45 million by FORBES' estimate.

One analysis of the Tor network performed by a student at Dublin's Trinity College found that Silk Road received around 60,000 visits a day, mostly users seeking to buy or sell drugs, along with other illicit items including unregulated cigarettes and forged documents. Silk Road takes a commission on all of its sales, starting at 10% and scaling down for larger transactions. Given that those commissions are collected in Bitcoins, which have appreciated close to 200-fold against the dollar since Silk Road launched in 2011, the Dread Pirate Roberts and any other stakeholders in Silk Road have likely amassed millions in profits. Click here to read about the shutdown of the illegal bazaar and its tale of online secrecy, murders-for-hire, courtroom drama and corruption. Despite the giant DEA crosshairs painted on his back and growing signs that the feds are probing the so-called "dark Web" that Silk Road and other black market sites inhabit, Roberts spoke with FORBES in his first-ever extended public interview for a reason: As with physical drug dealing, a turf war has emerged.

Competitors, namely a newly launched site called Atlantis with a real marketing budget and a CEO with far less regard for his privacy, are stealing Roberts' spotlight. "Up until now I've done my best to keep Silk Road as low profile as possible ... letting people discover [it] through word of mouth," Roberts says. "At the same time, Silk Road has been around two and a half years. We've withstood a lot, and it's not like our enemies are unaware any longer." Roberts also has a political agenda: He sees himself not just as an enabler of street-corner pushers but also as a radical libertarian revolutionary carving out an anarchic digital space beyond the reach of the taxation and regulatory powers of the state--Julian Assange with a hypodermic needle. "We can't stay silent forever. We have an important message, and the time is ripe for the world to hear it," says Roberts. "What we're doing isn't about scoring drugs or 'sticking it to the man.' It's about standing up for our rights as human beings and refusing to submit when we've done no wrong." "Silk Road is a vehicle for that message," he writes to me from somewhere in the Internet's encrypted void.

"All else is secondary." While Roberts waxes philosophical, his competitors are finding motivation enough in grabbing some of Silk Road's lucrative drug trade. On June 26 a video ad for Atlantis appeared on YouTube telling the story of "Charlie," a friendly-looking cartoon hipster. Charlie, according to text that popped up around the video's frame as jingly music played, is a "stoner" who moves to a new city for work and can't find any marijuana. That is, until he discovers Atlantis' "virtual black market," orders some pot and gets "high as a damn kite." YouTube removed the video within days for violating its terms of service but not before it had received close to 100,000 views and pulled the new Bitcoin-based black market into the public Internet's awareness. Atlantis' ad took a direct shot at Silk Road, calling itself "the world's best anonymous online drug marketplace." The Forbes E-book On Bitcoin Secret Money: Living on Bitcoin in the Real World, by Forbes staff writer Kashmir Hill, can be bought in Bitcoin or legal tender.

The next day, an employee of Atlantis named "Heisenberg" held a group chat with reporters where he described the site as the "Facebook to [Silk Road's] Myspace." In comments now deleted from an ask-me-anything session on the social news site Reddit, Atlantis' chief executive, who goes by the name "Vladimir," listed advantages over Silk Road like less downtime and smaller fees for sellers. "The road has more users," he wrote, "but our site is better (to put it bluntly)." The battle for the Web's drug corner is on. *** THE DREAD PIRATE ROBERTS isn't shy about naming Silk Road's active ingredient: The cryptographic digital currency known as Bitcoin. "We've won the State's War on Drugs because of Bitcoin," he writes. Bitcoin, which came into widespread use around the same time as Silk Road's creation, isn't exactly the financial-privacy panacea some believe it to be--its transactions can be traced using the same mechanisms that prevent fraud and counterfeiting within the Bitcoin economy.

But unlike with dollars, euros or yen, the integrity of the nearly $1 billion worth of Bitcoins floating around the Internet is maintained by the distributed computing power of thousands of users who run the crypto-currency's software, not by any bank or government. That means careful users never have to tie their accounts to their real-world identity. As a result Bitcoin-funded services deep within the dark Web, masked by anonymity tools like Tor, claim to offer everything from cyberattacks to weapons and explosives to stolen credit cards. [newsincvid id="25028502"] Mix up your coins in one of many available laundering services--Silk Road runs one automatically for all transactions on the site--and it becomes very difficult to follow the money. Even the FBI, according to one of the bureau's leaked internal reports, worries that Bitcoin's complexity and lack of a central authority "present distinct challenges" for tracking criminal funds. The result is a currency as convenient as PayPal and theoretically as anonymous as cash. "We're talking about the potential for a monumental shift in the power structure of the world," Roberts writes. "The people now can control the flow and distribution of information and the flow of money.

Sector by sector the State is being cut out of the equation and power is being returned to the individual." Of course, Roberts' lofty words on individual liberties provide a convenient veneer to justify his profitable business selling illegal, dangerous and addictive substances. But Roberts argues that if his users want heroin and crack, they should have the freedom to buy it and deal with the consequences. Unlike other Bitcoin-based underground sites, Silk Road bans all but what Roberts defines as victimless contraband. He won't permit the sale of child pornography, stolen goods or weapons, though the latter is a gray area. The site has experimented with selling guns and may yet reintroduce them, Roberts says. Feds Arrest Alleged ‘Dread Pirate Roberts,’ the Brain Behind the Silk Road Drug Site | WIRED Time of Publication: 1:43 pm. 1:43 pm Feds Arrest Alleged ‘Dread Pirate Roberts,’ the Brain Behind the Silk Road Drug Site The FBI has arrested the San Francisco man they say ran Silk Road, the notorious underground digital bazaar that allowed traffickers to anonymously peddle heroin, cocaine and nearly anything else illegal.

Ross William Ulbricht, 29, who allegedly operated the site as “Dread Pirate Roberts,” was charged in the Southern District of New York with narcotics trafficking conspiracy, computer hacking conspiracy and money laundering conspiracy. A second complaint out of Maryland charges him with conspiring to commit murder, after he allegedly paid hit men to kill an employee of Silk Road and one of the site’s vendors. The brazen site provided an international platform for drug dealers around the world to market a cornucopia of wares, expanding their empires beyond the corner drug stops and back alleys where they normally operated. Buyers and sellers could access the site only through the Tor anonymizing service and conducted transactions in Bitcoin to further conceal their identity. The identity of Dread Pirate Roberts has been one of the internet’s most tantalizing mysteries. The FBI and other agencies evidently solved that puzzle with smart online gumshoe work, focusing on finding the earliest internet forum posts that publicized Silk Road when it launched in 2011. They located two posts made by someone named “altoid.” Subpoenas revealed that “altoid” was Ulbricht.

In July, the FBI identified an overseas hosting company used to host Silk Road, and with the cooperation of local law enforcement they obtained a complete image of the server, giving them access to all the private messages on the site. The FBI complaint mentions a video of Ulbricht speaking with a friend in San Francisco, with whom he stayed. A video on YouTube (since removed, but embedded below) shows a conversation between two youths identified as Ross Ulbricht and Rene Pinell discussing their reasons for moving to San Francisco, their interest in launching startups to make a lot of money, along with talk about their first loves, favorite ice cream in childhood and their sexual experiences. Ulbricht also discusses his drug use in the conversation. Hundreds of illicit drugs were available for anyone to purchase on Silk road, from Afghani hash to LSD and ecstasy, though the terms of service did provide some limitations – they prohibited the sale of weapons of mass destruction, the solicitation of murder, or the sale of stolen bank card data or anything else whose purpose was to harm or defraud.

Ulbricht allegedly violated his own rule, however, when earlier this year he allegedly solicited two murders-for-hire of another Silk Road member who was threatening to release the identities of thousands of users of the site and of one employee. During the two-and-a-half years the site was in operation it was used by several thousand drug dealers to distribute hundred of kilograms of illegal drugs and other illicit services and goods to more than 100,000 buyers. The site did a brisk business. Between February 2011 and July 2013, it racked up more than 1.2 million transactions, generating sales revenue of more than 9.5 million Bitcoins — allegedly paying about 600,000 Bitcoins in commission to the site. The value of Bitcoins varies daily but the feds calculated this to about $1.2 billion in sales and $80 million in commissions.

According to the complaint, filed in the Southern District of New York, the site also sold hacking tools, such as keystroke loggers, password crackers and remote access and banking Trojans, as well as access to hacked Amazon and Netflix accounts and teaching tools such as a tutorial describing “22 different methods” for hacking ATMs. It also marketed a “Blackmarket Contact List”, which provided handy contact information for hitmen available for hire in more than ten countries, or purveyors of counterfeit bills and firearms. “The site has sought to make conducting illegal transactions on the internet as easy and frictionless as shopping online at mainstream e-commerce websites,” according to FBI agent Christopher Tarbell, who is quoted in the complaint. The site naturally was a watering hole for undercover feds who lurked on it since November 2011, buying drugs and hacking tools. The site operated from a number of servers located in various countries, with Ulbricht allegedly serving as owner and administrator, overseeing a small staff.

His duties included controlling the servers and infrastructure, setting the terms of service, managing the small customer support and administrative staff and dealing with scammers and extortionists, demonstrating a “willingness to use violence” in doing so, according to the feds. Support staff were paid in Bitcoins, amounting to $1,000-$2,000 a week. At the launch of the site, Ulbricht went by the name Silk Road but later adopted the Dread Pirate Roberts name, from the Princess Bride. Who is Silk Road? Some call me SR, SR admin or just Silk Road. But isn’t that confusing. I am Silk Road the market, the person, the enterprise, everything. But Silk Road has matured and I need an identity separate from the site and the enterprise of which I am now only a part. I need a name. Among the services he operated was a special feature for “superstar vendors” who were at greater risk of being targeted by the feds. The Stealth Mode service meant vendors would not be displayed in a visible listing but would only be accessibly by users who already knew the specific URL for the vendor’s page on the Silk Road site.

In March of this year, a Silk Road vendor known as FriendlyChemist began sending threats to Dread Pirate via private messages stating that he had a long list containing the real names and addresses of Silk Road vendors and customers that he had obtained by hacking the computer of another Silk Road vendor. He threatened to publish the data online unless he received $500,000. FriendlyChemist claimed he needed the money to pay off his drug suppliers. As proof, he supplied a sample list of usernames and addresses as well as the username and password of the vendor whose computer he allegedly hacked. Dread Pirate Roberts told FriendlyChemist to have his suppliers contact him directly and when one did, Dread Pirate proceeded to sweet talk him into supplying to Silk Road directly, rather than going through FriendlyChemist.

He allegedly wrote the supplier that FriendlyChemist was a liability “and I wouldn’t mind if he was executed.” Dread Pirate then disclosed a name and address in Canada for the supplier, stating he had a wife and three kids, adding “Let me know if it would be helpful to have his full address.” When Friendly Chemist pressured him to pay up, Dread Pirate Roberts contacted the supplier saying “I would like to put a bounty on his head if it’s not too much trouble for you. What would be an adequate amount to motivate you to find him? Necessities like this do happen from time to time for a person in my position.” Dread Pirate Roberts said the hit “doesn’t have to be clean” and the supplier later quoted him a price of $150,000 – $300,000, depending on whether the execution was clean or dirty. Dread Pirate Roberts tried to negotiate down the price saying he had previously paid only $80,000 for a clean hit. “Are the prices you quoted the best you can do?,” he asked. They agreed on $150,000 for the alleged hit, and the supplier later sent a photo of the victim.

In the photo was a sheet of paper next the victim with random numbers that Dread Pirate had provided. According to the feds, however, Canadian authorities indicated that no such murder matching the description had occurred. Ulbricht was arraigned in federal court in San Francisco this morning, and will be held in custody pending a bail hearing on Friday, the Justice Department says. Update 5:00 PM PST: Silk Road's 'Dread Pirate Roberts' convicted of running online drug marketplace | Technology | The Guardian Silk Road Silk Road's 'Dread Pirate Roberts' convicted of running online drug marketplace Ross Ulbricht faces up to life in prison after being found guilty of ‘aiding and abetting the distribution of drugs over the internet’ and other charges An artist’s impression of Ross Ulbricht as he stood trial in New York.

Photograph: Elizabeth Williams/AP Wednesday 4 February 2015 19.39 EST First published on Wednesday 4 February 2015 16.00 EST Close This article is 1 year old The suspected mastermind of the online drug emporium Silk Road is facing the prospect of spending the rest of his life in prison after a jury returned a guilty verdict at the end of a four-week trial that revealed a plethora of detail about US investigations into the use of the bitcoin digital currency for drug trafficking and other crimes. Ross Ulbricht, 30, was convicted on all seven charges which he had faced at Manhattan district court, including drug trafficking, criminal enterprise, aiding and abetting the distribution of drugs over the internet, computer hacking and money laundering. His defence team attempted to convince the jury that, while Ulbricht was one of the site’s creators, known as Dread Pirate Roberts, the mysterious mastermind behind the deep-web marketplace was actually Mark Karpelès, the founder of bitcoin exchange Mt Gox.

However, the prosecution was able to produce evidence including Ulbricht’s personal journals, as well as his bitcoin wallet containing millions of dollars’ worth of the online-only currency, all of which pointed to his guilt. Bitcoin: will 2015 be a make-or-break year? Read more Ulbricht was arrested in San Francisco in October 2013 in the wake of US investigations into the use of bitcoin for drug trafficking and other illegal activities and charged with being Dread Pirate Roberts, a name taken from the film The Princess Bride where it referred to a mythical persona shared between several people. Visitors to Silk Road could procure anything from LSD to ecstasy pills and even read reviews and star ratings left by previous customers of dealers, rather as one might do on sites such as eBay or Amazon. By spring 2013, 10,000 products were for sale, 70% of which were drugs, in addition to more than a hundred listings for “services,” much of which related to hacking into social network accounts, and more than 800 listings for digital goods such as pirated content or hacked Amazon and Netflix accounts. Fake drivers’ licences and fake passports could also be found.

Prosecutors said Silk Road had generated nearly $213.9m (£140m) in sales and $13.2m in commissions before police shut it down. Police had claimed that Ulbricht had been running the site since 2011, doing so for much of 2013 from his home in San Francisco and from a nearby cafe where he was eventually arrested. The jury of six men and six women needed a little over three hours to deliberate while Ulbricht turned toward his supporters and raised his hand as he was led from the court after the verdict was read. “Ross is a hero,” shouted one of the supporters who have rallied behind him and regard the US government’s case as an attack on internet freedom. The US attorney for Manhattan, Preet Bharara, said Ulbricht’s conviction should send a message to anyone attempting to operate an online criminal enterprise. “The supposed anonymity of the dark web is not a protective shield,” he said. Ulbricht had conceded that he created Silk Road, which his defence team had said was intended as a “freewheeling, free-market site” where all but a few harmful items could be sold.

They argued that the “economic experiment” became too stressful for him, so he handed it to others before being lured back. Joshua Dratel, Ulbricht’s lawyer, had tried to raise questions in jurors’ minds about whether someone else had been operating Silk Road, such as Karpelès, who was never charged and has denied involvement. Although a federal agent told jurors he had been investigating Karpelès, the judge, Katherine Forrest, struck out much of that testimony as improper. Ulbricht faces up to life in prison and a minimum term of 20 years. His sentencing was scheduled for 15 May, although his defence team signalled he would appeal. A separate trial of Ulbricht in Baltimore, on charges including attempted commission of a murder-for-hire, continues. Ross Ulbricht of Silk Road: 5 Fast Facts You Need to Know | Heavy.com Get Heavy's Top 5 News Stories Every Day We will never share your email address.

Feds Bust Billion-Dollar Online Black Market & Its Leader, ‘Dread Pirate Roberts’ Published Updated 2:15 pm EST, April 17, 2015 7 Comments By Brad Michelson 242 Share Tweet Share Email Follow Federal authorities have seized an online marketplace for illegal drugs and services called Silk Road and arrested the man behind it, Ross William Ulbricht, who goes by the alias Dread Pirate Roberts. According to an FBI probable cause affidavit (scroll down to read the full doc), from January 2011 to September 2013, “…the Silk road website has served as a sprawling black-market bazaar, where illegal drugs and other illicit goods and services have been regularly bought and sold by the site’s users.” Here’s what you should know about Ulbricht and the apparent end of his enterprise. 1. Ulbricht Allegedly Created the Internet’s ‘Most Sophisticated Criminal Marketplace’ (Google+) Silk Road operated on a clandestine Tor network and sold goods in exchange for the digital currency Bitcoin .

Wikipedia defines Tor : Tor directs Internet traffic through a free, worldwide, volunteer network consisting of more than three thousand relays to conceal a user’s location or usage from anyone conducting network surveillance or traffic analysis. According to the criminal complaint that led to Ulbricht’s arrest warrant (located at the bottom of this article), the site has, “as of July 23,2013, there were approximately 957,079 registered user accounts.” The FBI special agent responsible for the document says that the website does nothing to regulate whether a user can have more than one account, muddying the nearly million-user figure: This is not necessarily equal to the number of actual users of the website, since nothing prevents a user from creating multiple accounts. However, based on my training and experience, this volume of user accounts indicates that the site has been visited by hundreds of thousands of unique users. 2. The Site Solicited the Sale of Illegal Drugs & Services Via The Guardian. Silk Road was a marketplace for drug dealers, and as its host, Ulbricht is implicated.

According to the complaint, Ulbricht has attracted and acquired distributors and manufacturers of various drugs, including marijuana, cocaine, methamphetamine, ecstasy, LSD, and so on. He is accused of facilitating the transaction and trafficking of the illegal substances. According to the complaint, the drugs sold on the site were generally sold in “individual-use quantities, although some vendors sell in bulk.” Additionally, Silk Road also facilitated the selling of services like forgery, computer hacking, and even murder for hire. According to the FBI complaint, one vendor was offering hacking into social media accounts and giving the customer the ability to “write, upload, delete, view all personal info.” Another listing offered tutorials on ATM hacking techniques. Other postings included black market arms contact lists, malicious computer software (like computer viruses and password stealing tools). The document explains that at the time of writing, there were 169 listings under the forgery category. Vendors were offering fake government documents, including drivers licenses, passports, social security cards, utility bills, and so on. 3. Silk Road Dealt Exclusively in Bitcoins, Exchanging More Than $1 Billion in Two Years (Getty) The Silk Road’s biggest asset is its anonymity for users and vendors.

One of the things contributing to this is that the online market uses the Bitcoin currently exclusively in its transactions between users. The complaint explains the non-fiat currency as follows: Bitcoins are an anonymous, decentralized form of electronic currency, existing entirely on the Internet and not in any physical form. The currency … is generated and controlled automatically through computer software operating on a “peer-to-peer” network. Bitcoin transaction are processed collectively by the computers composing the network.” Although all Bitcoin transactions are recorded on a public log known as the “Blockchain,” it is nearly impossible to track the users who are transferring the money when it is backed up with software designed to frustrate tracking. This level of anonymity is a huge asset in the world of blackmarket sales. In two years the site allegedly raked in some 9.5 million bitcoins in revenue, or $1.2 billion, with some $80 million of that in commission of transactions. The seizure of Silk Road represents the largest seizure of Bitcoin assets in history. Click here to read more 4. Ulbricht’s Carelessness Got Him Caught It appears that Ulbricht’s carelessness is what got him caught. The complaint document illuminates multiple instances where he mistakenly revealed his real identity.

According to Slate , Ulbricht went onto Stack Overflow, a site where programmers ask and answer questions, catering to pros and amateurs alike. On the site, the accused asked , “How can I connect to a Tor hidden service using curl in php?” Silk Road is a website on a Tor network. According to Slate, Ulbricht posted this question using his real name. Soon after realizing this, he changed the name to “Frosty.” And this is what the criminal complaint points to as a key piece of evidence: Based on forensic analysis of the Silk Road Web Server, I know that the computer code … includes a customized PHP strip based on ‘curl’ that is functionally very similar to the computer code described in Ulbricht’s posting on Stack Overflow, and includes several lines of code that are identical to lines of code quoted in the posting. His Stack Overflow account still exists, and you can check it out here . As Ulbricht’s story continues to make headlines, it has also become a hot topic in the Bitcoin world. Not surprising at all, the Bitcoin forum on Reddit has chimed in. The thread about the article has exploded with comments pointing out Ulbricht’s obvious mistakes as written in the complaint.

Reddit user /u/gwern even found some forum posts Ulbricht is alleged to have made in the early promoting of the Silk Road website that are directly written about in the FBI document. These posts were made soon after Ulbricht allegedly created the website, when he was attempting to garner attention for the site. The first post, posted to Bitcointalk.org , could not be found in its original form, but /u/gwern found a post where it was quoted. The second post is one Ulbricht made months later on a website called Shroomery.org , a forum for fans of “magic mushrooms.” Ulbricht was arrested on October 2 in San Francisco. 5. Ulbricht Is Accused of Money Laundering & Hacking (Getty) As we mentioned above, transactions of Bitcoins can be made nearly impossible to track when you introduce software designed to counter tracing. According to the complaint, the Silk Road website uses something called a “tumbler” to facilitate this result.

This is how the Silk Road Wiki describes it: “[The Silk Road’s tumbler] sends all payments through a complex, semi-random series of dummy transactions, … making it nearly impossible to link your payment with any coins leaving the site.” Basically, the tumbler obscures any link between the buyer and vendor’s Bitcoin information. According to the FBI agent who wrote the complaint, “the only function served by such ‘tumblers’ is to assist with the laundering of criminal proceeds.” Additionally, Ulbricht has also been accused of committing computer hacking crimes. The document says that he accessed information from protected computers for the purpose of commercial advantage and private financial gain, “and in furtherance of criminal and tortious acts.” 6. Ulbricht Allegedly Was Willing to Solicit Murder-for-Hire According to seized communications, a Silk Road vendor called FriendlyChemist blackmailed Ulbricht by threatening to publish vendor and customer information if Ulbricht didn’t give him $500,000. FriendlyChemist told Ulbricht in a message that he owed the money to his drug manufacturers.

In fear of losing the main tenant of his business — anonymity — he contacted the manufacturers and offered to add them as a distributor on his site. He then asked the group to murder the blackmailer, who Ulbricht revealed to be living in White Rock, British Columbia, Canada. They agreed on a fee and the murder was commissioned. About 24 hours later, Ulbricht received a message reading, “Your problem has been taken care of. . . . Rest easy though, because he won’t be blackmailing anyone again. Ever,” according to the complaint. Subsequent messages revealed that the murderers provided a picture of the victim’s face after the job was done. 7. Ulbricht Has a Big Social Media Presence for a Black Market Leader Despite his top-secret Silk Road persona, Ulbricht maintained several public social media accounts under his real name. This LinkedIn page , which is a near-identical match for the LinkedIn page cited in the affidavit, professes Ulbricht’s new “goals” to “abolish the use of coercion and aggression amongst mankind”: (LinkedIn) Other social media accounts belonging to Ulbricht have been uncovered.

According to The Verge , his online presence includes a Facebook page , Google+ account , Stack Overflow account, defunct Twitter account , and YouTube channel . Much like the manifesto he wrote on his LinkedIn page, Ulbricht also published an essay on his Facebook account on July 5, 2010 titled “Thoughts on FREEDOM,” exploring his ideas on what it means to be free and how to define it as such. 8. Ulbricht Is a 29-Year-Old Investment Advisor Ross Ulbricht received his undergraduate degree from the University of Texas at Dallas, where he studied sciences. Ulbricht also attended Pennsylvania State University for his graduate education, where he studied solar cells. He received his degree in physics. Although his educational background is in the sciences, he listed his position on his LinkedIn profile as an “Investment Adviser and Entrepreneur.” The page also says that he started a business called Good Wagon Books. He describes it as such: Good Wagon Books has collected tens of thousands of reusable items and found them new homes. We serve three groups in our local community: Homeowners: By helping to de-clutter their lives and homes.

Employees: By providing training and development, good pay, and an active work environment. Charities: Though we are technically a for-profit company, we don’t actually make any profit because we give so much to charity. For every thousand books we sell, we donate $100 to Explore Austin, a local non-profit that mentors inner city youth (exploreaustin.com). The items we can’t sell get donated to Inside Books Project, a prison literacy program (insidebooksproject.org). Anything else is found a suitable home, nothing useful gets thrown out. His family is dumbfounded by the accusations against Ross. “He’s an exceptionally bright and smart kid,” said his half-brother Travis Ulbricht. “He’s always been upstanding and never had any trouble with the law that I knew of.” “I don’t know how they messed it up and I don’t know how they got Ross wrapped into this, but I’m sure it’s not him,” said René Pinnell, Ulbricht’s close friend and former roommate. 9. Silk Road Has Its Own User Wiki & Forum The Silk Road website includes its own Wiki and community forums which allows users to learn about the website’s operations and discuss issues within the SR community.

The Wiki includes sellers and buyers guides, guides to eluding authorities online and in real life. For instance, it instructs buyers to ship their purchased goods to P.O. boxes instead of their own home to avoid direct tracing. There are also tutorials on how to configure your computer systems to hide any trace that you even visited the site. 10. Ulbricht’s Username Was Based on a Princess Bride Character (Facebook) Apparently Ulbricht’s online persona lived under the username “Dread Pirate Roberts,” which is a character from the 1987 film, The Princess Bride . In the film, it is revealed that Robert is a moniker taken by a series of individuals who periodically pass the name and reputation to a chosen successor. “Who is Silk Road? Some call me SR, SR admin or just Silk Road. But isn’t that confusing? I am Silk Road, the market, the person, the enterprise, everything. But Silk Road has matured and I need an identity separate from the site and the enterprise of which I am now only a part. I need a name,” wrote Ulbricht. He soon announced his new name as “Dread Pirate Roberts” and began posting as such.

If you would like to read any of the official documents used to secure the arrest warrant for Ulbricht, check out the documents below: Brad Michelson Silk Road illegal drug website shut down by FBI - Technology & Science - CBC News Silk Road illegal drug website shut down by FBI Alleged owner "Dread Pirate Roberts" faces trafficking, hacking, money laundering charges Thomson Reuters Posted: Oct 02, 2013 1:30 PM ET Last Updated: Oct 02, 2013 3:02 PM ET Related Stories Canadians among top participants on illegal drug website The Silk Road website had operated since early 2011. (iStock) U.S. law enforcement authorities have shut down "Silk Road," an anonymous Internet marketplace for illegal drugs like heroin and cocaine and criminal activities such as murder for hire, and arrested its alleged owner. The Federal Bureau of Investigation said Wednesday it arrested Silk Road owner, Ross William Ulbricht, 29, known online as "Dread Pirate Roberts," in San Francisco on Tuesday, according to court filings. Ulbricht, who holds an advanced degree in chemical engineering, appeared in federal court on Wednesday and a bail hearing was set for Friday.

'He is a really stellar, good person and very idealistic.' - Lyn Lacava, Ross William Ulbricht's mother His lawyer Brandon LeBlanc, a public defender, declined to comment. Federal prosecutors in New York charged Ulbricht with one count each of narcotics trafficking conspiracy, computer hacking conspiracy and money laundering conspiracy, the filing said. "Silk Road has emerged as the most sophisticated and extensive criminal marketplace on the Internet today," FBI agent Christopher Tarbell said in the criminal complaint. More than 900,000 registered users The site was used by "several thousand drug dealers" to sell "hundreds of kilograms of illegal drugs," he said. The site, which has operated since early 2011, also offered tutorials on hacking ATM machines, contact lists for black market connections and counterfeiters, and guns and hit men for sale, according to the charges. More than 900,000 registered users of the site bought and sold drugs using the digital currency Bitcoin. In recent media reports about the growing popularity of Bitcoin, the Silk Road website has emerged as part of a darker side to the use of digital currencies.

Through the site, according to the charges, users could buy drugs and have them shipped to an address. Investigators, posing as regular users on Silk Road, made more than 100 purchases of drugs, which were shipped to the New York area. According to the complaint, Ulbricht, who shortened his alias from Dread Pirate Roberts to DPR when posting on Silk Road's forums, operated the site from San Francisco. At times, he used computers at internet cafes to access the servers running the website, which employed several technological tools to mask the location of its servers and the identities of its administrators and users. The complaint described other aspects of Ulbricht's online presence: In a Google+ profile, he described himself as a fan of libertarian economic philosophy and posted videos from the Ludwig von Mises Institute, an Auburn, Alabama-based economics institute. Reached by phone in Austin, Texas, Ubricht's parents said they had not known what their son was doing in San Francisco. "He is a really stellar, good person and very idealistic," said Ulbricht's mother, Lyn Lacava. "I know he never meant to hurt anyone." Ulbricht's father Kirk confirmed his son had received a master's in material sciences from Pennsylvania State University.

His thesis was titled: "Growth of EuO Thin Films by Molecular Beam Epitaxy." "He did amazing research on crystals and exotic materials they hoped would have some use for humans," Ulbricht said. "But it was very theoretical stuff." The complaint against Ulbricht describes a darker side. During one correspondence with a Silk Road user, Ulbricht tried to call out a hit on another user with whom he had a dispute. That user, known online as "FriendlyChemist," was threatening to expose the identities of thousands of Silk Road users unless Ulbricht sent him money. "I wouldn't mind if he was executed," Ulbricht wrote, offering personal details about his foe, including the fact that he was a married father of three, and the names of the city and province where he lived. In a later post, Ulbricht wrote: "He is threatening to expose the identities of thousands of my clients." "This kind of behavior is unforgivable to me. Especially here on Silk Road, anonymity is sacrosanct." $3.6M in bitcoin seized During the raid, authorities seized $3.6 million worth of bitcoin, which was used instead of cash or credit cards to complete transactions on Silk Road.

The charges against Ulbricht said his website generated sales of more than 9.5 million bitcoin, roughly equivalent to $1.2 billion. Authorities seized the currency by taking control of the digital "wallets" Silk Road used to store bitcoin. In a corresponding civil asset forfeiture action, prosecutors claimed Silk Road and Ulbricht were liable to the government for the value of all transactions involving drug tracking and computer hacking, as well as for money laundering penalties, and a final amount would be determined at trial. The raid on Wednesday was not the first time the U.S. government has made arrests related to Silk Road. Earlier this year, authorities in South Carolina arrested Eric Daniel Hughes, known on Silk Road as "Casey Jones," and charged him in state court with drug possession. The Drug Enforcement Agency seized units of bitcoin, which Hughes allegedly used to purchase drugs from the online market. Bitcoin, which has been around since 2008, first came under scrutiny by law enforcement officials in mid-2011 after media reports surfaced linking the digital currency to Silk Road.

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Ross Ulbricht, aka Dread Pirate Roberts, Sentenced in Manhattan Federal Court to Life in Prison — FBI May 29, 2015 Ross Ulbricht, aka Dread Pirate Roberts, Sentenced in Manhattan Federal Court to Life in Prison Preet Bharara, the United States Attorney for the Southern District of New York, announced that ROSS ULBRICHT, a/k/a “Dread Pirate Roberts,” was sentenced today in Manhattan federal court to life in prison in connection with his operation and ownership of Silk Road, a hidden website designed to enable its users to buy and sell illegal drugs and other unlawful goods and services anonymously and beyond the reach of law enforcement between January 2011 and October 2013. ULBRICHT was found guilty of each of the seven charges he faced on February 5, 2015, following a four-week jury trial. U.S. District Judge Katherine B. Forrest imposed today’s sentence. Manhattan U.S. Attorney Preet Bharara said: “Make no mistake: Ulbricht was a drug dealer and criminal profiteer who exploited people’s addictions and contributed to the deaths of at least six young people.

Ulbricht went from hiding his cybercrime identity to becoming the face of cybercrime and as today’s sentence proves, no one is above the law.” According to the evidence presented at trial, statements made during other public proceedings including today’s sentencing, and other court documents: ULBRICHT created Silk Road in January 2011, and owned and operated the underground website until it was shut down by law enforcement authorities in October 2013. Silk Road emerged as the most sophisticated and extensive criminal marketplace on the Internet, serving as a sprawling black-market bazaar where unlawful goods and services, including illegal drugs of virtually all varieties, were bought and sold regularly by the site’s users. While in operation, Silk Road was used by thousands of drug dealers and other unlawful vendors to distribute hundreds of kilograms of illegal drugs and other unlawful goods and services to more than 100,000 buyers, and to launder hundreds of millions of dollars deriving from these unlawful transactions. ULBRICHT deliberately operated Silk Road as an online criminal marketplace intended to enable its users to buy and sell drugs and other illegal goods and services anonymously and outside the reach of law enforcement. ULBRICHT sought to anonymize transactions on Silk Road in two principal ways.

First, ULBRICHT operated Silk Road on what is known as “The Onion Router,” or “Tor” network, a special network of computers on the Internet, distributed around the world, designed to conceal the true IP addresses of the computers on the network and thereby the identities of the networks’ users. Second, ULBRICHT designed Silk Road to include a Bitcoin-based payment system that served to facilitate the illegal commerce conducted on the site, including by concealing the identities and locations of the users transmitting and receiving funds through the site. The vast majority of items for sale on Silk Road were illegal drugs, which were openly advertised as such on the site. As of September 23, 2013, the Silk Road home page displayed nearly 13,000 listings for controlled substances, listed under such categories as “Cannabis,” “Dissociatives,” “Ecstasy,” “Intoxicants,” “Opioids,” “Precursors,” “Prescription,” “Psychedelics,” and “Stimulants.” From November 2011 to September 2013, law enforcement agents made more than 60 individual undercover purchases of controlled substances from Silk Road vendors.

These purchases included heroin, cocaine, ecstasy, and LSD, among other illegal drugs, and were filled by vendors believed to be located in more than ten different countries, including the United States, Germany, the Netherlands, Canada, the United Kingdom, Spain, Ireland, Italy, Austria, and France. The narcotics distributed on Silk Road have been linked to at least six overdose deaths across the world. These overdose deaths included Jordan M., a 27-year old Microsoft employee who was found unresponsive in front of his computer, which was logged onto Silk Road at the time, and died as a result of heroin and other prescription drugs that he had ordered from Silk Road. Preston B., from Perth, Australia, and Alejandro N., from Camino, California, both 16 years old, died as a result of taking 25i-NBOMe, a powerful synthetic drug designed to mimic LSD (commonly referred to as “N-Bomb”), which was purchased from Silk Road.

Additional victims included Bryan B., a 25-year old from Boston, Massachusetts, and Scott W., a 36-year old from Australia, who both died as a result of heroin purchased from Silk Road, and Jacob B., a 22-year old from Australia, who died from health complications that were aggravated by the use of drugs purchased from Silk Road. In addition to illegal narcotics, other illicit goods and services were openly bought and sold on Silk Road. For example, as of September 23, 2013, there were: 159 listings under the category “Services,” most of which offered computer hacking services, such as a listing by a vendor offering to hack into social networking accounts of the customer’s choosing; 801 listings under the category “Digital goods,” including malicious software, hacked accounts at various online services, and pirated media content; and 169 listings under the category “Forgeries,” including offers to produce fake driver’s licenses, passports, Social Security cards, utility bills, credit card statements, car insurance records, and other forms of false identification documents.

Using the online moniker “Dread Pirate Roberts,” or “DPR,” ULBRICHT controlled and oversaw every aspect of Silk Road, and managed a staff of paid, online administrators and computer programmers who assisted with the day-to-day operation of the site. Through his ownership and operation of Silk Road, ULBRICHT reaped commissions worth more than $13 million generated from the illicit sales conducted through the site. ULBRICHT also demonstrated a willingness to use violence to protect his criminal enterprise and the anonymity of its users, soliciting six murders-for-hire in connection with operating the site, although there is no evidence that these murders were actually carried out. * * * ULBRICHT, 31, of San Francisco, California, was convicted of seven offenses after a four-week jury trial: distributing narcotics, distributing narcotics by means of the Internet, conspiring to distribute narcotics, engaging in a continuing criminal enterprise, conspiring to commit computer hacking, conspiring to traffic in false identity documents, and conspiring to commit money laundering. In addition to the life sentence prison term, ULBRICHT was ordered to forfeit $183,961,921.

In imposing today’s sentence, Judge Forrest said: “There must be no doubt that lawlessness will not be tolerated. There must be no doubt that no one is above the law—no matter one’s education or privileges. All stand equal before the law. There must be no doubt that you cannot run a massive criminal enterprise and because it occurred over the Internet minimize the crime committed on that basis.” Mr. Bharara praised the outstanding investigative work of the Federal Bureau of Investigation and its New York Special Operations and Cyber Division, as well as the outstanding investigative work of the DEA’s New York Organized Crime Drug Enforcement Strike Force, which comprises agents and officers of the DEA, the IRS, the New York City Police Department, U.S. Immigration and Customs Enforcement’s (“ICE”) Homeland Security Investigations (“HSI”), the New York State Police, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Secret Service, the U.S. Marshals Service, Office of Foreign Assets Control, and NY Department of Taxation. Mr. Bharara also thanked the ICE-HSI Chicago-O’Hare office for its assistance and support, as well as the Department of Justice’s Computer Crime and Intellectual Property Section and Office of International Affairs.

Additionally, Mr. Bharara praised the foreign law enforcement partners whose contributions to the success of the investigation and prosecution have been invaluable, namely, the Reykjavik Metropolitan Police of the Republic of Iceland, and the French Republic’s Central Office for the Fight Against Crime Linked to Information Technology and Communication. The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys Serrin Turner and Timothy T. Howard are in charge of the prosecution, and Assistant United States Attorney Christine Magdo is in charge of the forfeiture aspects of the case. This content has been reproduced from its original source . Section Links VIP at illegal-drug site Silk Road nabbed in Thailand, police say - CNET VIP at illegal-drug site Silk Road nabbed in Thailand, police say VIP at illegal-drug site Silk Road nabbed in Thailand, police say A 54-year-old Canadian man arrested this week served as the "closest advisor" to Silk Road founder "Dread Pirate Roberts," according to law enforcement.

Up Next Now begins the @realDonaldTrump era The right-hand man of Ross Ulbricht -- convicted mastermind of Silk Road, the notorious online bazaar for illegal drugs -- has been arrested in Thailand, according to law enforcement officials. The US Department of Justice said Friday that Roger Thomas Clark, aka "Variety Jones," had been apprehended Thursday and is awaiting extradition to the United States. The Justice Department alleges that the 54-year-old Canadian citizen helped Ulbricht with everything from staying out of the hands of police to creating rules for Silk Road's users to strengthening the site's technical infrastructure. Before being shut down by police, the Silk Road website served as a trading post for illegal drugs like cocaine, as well as other outlawed goods. Another of the site's key players has just been apprehended, according to officials. Wavebreak Media Ltd./Corbis Clark served as Ulbricht's "closest adviser and confidante as together they facilitated an anonymous global black market for all things illegal," James Gibbons, an agent with the Department of Homeland Security, was quoted as saying in a statement from the Justice Department.

The 31-year-old Ulbricht, alias "Dread Pirate Roberts," was sentenced in May to life in prison for his role in Silk Road, which operated from 2011 to 2013 before being shut down by police . The marketplace, characterized by law enforcement as the most extensive criminal bazaar on the Internet, relied on technologies that would supposedly hide the identities of its users and creators. The site was used by thousands of drug dealers and others to sell hundreds of kilograms of drugs and other contraband and to launder hundreds of millions of dollars in revenues, the Justice Department said in its statement. Clark himself made at least hundreds of thousands of dollars in his position at Silk Road, the Justice Department claims. In addition to assistance with the site, Clark allegedly helped Ulbricht keep other Silk Road staff in line, advising that they be threatened with violence to keep them from going to police.

Federal prosecutors claim that at one point Ulbricht and Clark discussed "tracking down" a certain staffer to be sure he hadn't "gone off the rails." In that exchange, Clark allegedly said, "Dude, we're criminal drug dealers -- what line shouldn't we cross?" Takedown of Silk Road's Dread Pirate Roberts Not About Internet Privacy Takedown of Silk Road's Dread Pirate Roberts Not About Internet Privacy The Silk Road marketplace for illegal goods hidden under the veil of anonymous online servers gets shut down. The Dread Pirate Roberts isn't just the fictional name of a movie character from the classic 1987 film The Princess Bride ; it's also the alias for an alleged criminal mastermind who has now been arrested for operating the illegal goods Silk Road Website. While the Silk Road site was hidden in the bowels of the Internet under the cloak of anonymity provided by the Tor onion router project, the shutdown spearheaded by the U.S Federal Bureau of Investigation (FBI) did not involve a technology breach of Tor.

According to the FBI's criminal complaint , Silk Road operated from January 2011 until September 2013, with Ross Ulbricht, also known as "Dread Pirate Roberts," allegedly violating U.S narcotics laws selling drugs and other banned substances. The FBI also alleges that Silk Road provided a platform for selling "illicit goods and services, including malicious software designed for computer hacking, such as password stealers, keyloggers and remote access tools." Tor The way that "Dread Pirate Roberts" was able to stay hidden from the law with Silk Road was by way of what the FBI complaint calls an "online criminal marketplace outside the reach of law enforcement or governmental regulation." The way Silk Road did that was by operating on the Tor onion router network . Tor provides a system by which traffic can be anonymized by going through multiple "onion" routers, with each layer providing an additional layer of abstraction. According the FBI complaint, the use of Tor made it "practically impossible" to physically identify where Silk Road actually was located. Going a step further, Silk Road uses bitcoins as its currency for transactions. Bitcoins are a form of peer-to-peer currency that is generated online and is difficult to trace.

"In order to access the Silk Road website, a user need only download Tor browser software onto his computer and then type in Silk Road's .onion address in the user's Tor browser," the FBI complaint stated. Kevin O'Brien, enterprise solution architect at CloudLock , told eWEEK that the FBI's description of the Tor piece of Silk Road isn't quite accurate. "The .onion address is a descriptor, which allows a Tor client to connect to a service such as the Silk Road Website indirectly via the Tor network, without ever knowing the actual IP address of the service itself," O'Brien said. "There are some additional components involved, but in essence, Tor is about indirection, and .onion addresses are the mechanisms of indirect routing used to provide this functionality." The takedown of Silk Road is also not a reflection of any particular flaws in the privacy that Tor aims to provide. "While we've seen no evidence that this case involved breaking into the webserver behind the hidden service, we should take this opportunity to emphasize that Tor's hidden service feature (a way to publish and access content anonymously) won't keep someone anonymous when paired with unsafe software or unsafe behavior," the Tor Project wrote in a blog post .

"It is up to the publisher to choose and configure server software that is resistant to attacks." O'Brien noted that the mechanism through which the FBI traced the Silk Road network back to its maintainer is fairly prosaic: It ordered illegal goods, gathered a chain of information about both the physical vendors shipping those goods as well as the systems that were involved in the payment processing, and then obtained access to those systems for further forensics. "The weakest link was in the physical goods being transmitted," O'Brien noted. "By tracing shipments from those vendors, a particular shipment to Ulbricht was tagged and traced, and the forged identification papers being used to obtain more servers allowed the rest of the activity to be unraveled." Ulbricht ("Dread Pirate Roberts") also had posted various pieces of information publicly that led investigators to his front door. In O'Brien's view, simply using Tor for connectivity appears to still be fairly "safe" from the perspective of avoiding tracing. "However, merging real-world activities, like having goods sent to a physical address with Tor activity, allows an interested authority or third-party to, over time, triangulate a pattern of behavior and a specific user," O'Brien said.

"What cracked the Silk Road case for the FBI was essentially traditional detective work, rather than a fundamental security flaw in Tor." Sean Michael Kerner is a senior editor at eWEEK and InternetNews.com. Follow him on Twitter @TechJournalist .

Question: What illegal online marketplace was operated by "Dread Pirate Roberts"?
Answer: Silk Road